ACCT 1201 Chapter Notes - Chapter 11: Retained Earnings, Treasury Stock, Stock Split

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greenporcupine206

26 Jan 2015

School

Northeastern University

Department

Accounting

Course

ACCT 1201

Professor

Kim Jackson

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Document Summary

Stockholders" equity = contributed capital + retained earnings: authorized number of shares. Max number of shares a company can sell: issued shares. The total number of shares of stock that have been sold: outstanding shares. Total number of shares of stock that are owned by stockholders on any particular date: common stock. Basic voting stock issued by a corporation: par value. Value per share of stock specified in the charter: legal capital. Permanent amount of capital defined bt state law that must remain invested as a safety: issuance of stock. Record addional paid in capital only when reselling not when buying. The date on which the board of directors approves a dividend. Date on which the corporation prepares the list of current stockholders: payment date. Date on which a cash dividend is paid to the stockholders. A distribution of additional shares of a corporation"s own stock. An increase in the total number of authorized shares by a specified ratio.

Related Questions

1. 11-4 Reporting the Stockholders' Equity Section of the BalanceSheet [LO2, LO3, LO4]

Shelby Corporation was organized in January 2010 by 10 stockholdersto operate an air conditioning sales and service business. Thecharter issued by the state authorized the following capitalstock:

Common stock, $1 par value, 200,000 shares.

Preferred stock, $8 par value, 6 percent, 50,000 shares.

During January and February 2010, the following stock transactionswere completed:

a.	Collected $40,000 cash from each of the 10 organizers and issued2,000 shares of common stock to each of them.
b.	Issued 15,000 shares of preferred stock at $25 per share; collectedin cash.

Net income for 2010 was $40,000; cash dividends declared and paidat year-end were $10,000.

Required:

Prepare the stockholders' equity section of the balance sheet atDecember 31, 2010. (Omit the "$" sign in your response.)

Stockholders' Equity%u2014December 31, 2010
Contributed capital:
Preferred stock	$
Additional paid-incapital, preferred stock
Common stock
Additional paid-incapital, common stock

Totalcontributed capital
Retained earnings

Total stockholders'equity	$

E11-1Computing Shares Outstanding [LO1]

The 2008 annual report for Fortune Brands, the seller of Pinnaclegolf balls and MasterLock padlocks,disclosed that 750 millionshares of common stock have been authorized. At the end of 2007,235 million shares had been issued and the number of shares intreasury stock was 81 million. During 2008, 1 million common shareswere reissued from treasury, and 5 million common shares werepurchased for treasury stock.

Required:

(a)	Determine the number of common shares issued at the end of 2008.(Enter your answer in millions.)

Issued stock

(b)	Determine the number of common shares in treasury at the end of2008. (Enter your answer in millions.)

Treasury stock

(c)	Determine the number of common shares outstanding at the end of2008. (Enter your answer in millions.)

Shares outstanding

erinfly733

The stockholders' equity section on the December 31, 2012,balance sheet of Chemfast Corporation reported the followingamounts: Contributed Capital Preferred Stock (par $20; authorized10,000 shares, ? issued, of which 1,000 shares are held as treasurystock) $ 88,000 Additional Paid-in Capital, Preferred 10,340 CommonStock (no-par; authorized 20,000 shares, issued and outstanding5,200 shares) 478,400 Retained Earnings 22,000 Treasury Stock,1,000 Preferred shares at cost 9,100 Assume that no shares oftreasury stock have been sold in the past. Required: Complete thefollowing statements. (Amounts to be deducted should be indicatedby a minus sign. Round "per share values" to 2 decimal places.)

Complete the following statements. (Amounts to bededucted should be indicated by a minus sign. Round "per sharevalues" to 2 decimal places.)

The number of shares of perferred stock issuedwas

The number of shares of perferred stock outstandingwas

The average issue price of the preffered stockwas

The average issue price of the common stockwas

The treasurey stock transaction increased or decreasedstock equity by

The treasury stock cost

Total stockholders equity is

magentahamster631

Select the best answer from the list below to completestatements that follow.

authorized shares treasury stock book value per share issuedshares retained earnings par value per share outstanding sharesadditional paid-in-capital market value per share stock split

11. The number of shares sold or distributed to stockholderare____________ .

12. An arbitrary amount that is stated on the face of the stockcertificate is ______________

. 13. The number of shares issued less the number of shares heldas treasury stock are ______________________________.

14. The maximum numbers of shares a company may issueare______________

. 15. Net income that has been earned by the corporation but notpaid out as dividends are ______________________________.

16. The amount received for each share of stock in excess of parvalue is . 17. Stock issued by the firm, but then repurchased andnot retired is ________________________.

18. Distribution of additional shares of stock and reduction ofthe par value of the stock is ______________________________.

19. The selling price of the stock as indicated by the mostrecent stock transaction is___________________________________.

20. Assuming no preferred stock exists, total stockholders'equity divided by the number of shares of common stock outstandingis equal to _________________________

sangriajellyfish22

ACCT 1201 Chapter Notes - Chapter 11: Retained Earnings, Treasury Stock, Stock Split

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