Discuss the propriety of showing:(a) Treasury stock as an asset.(b) “Gain” or “loss” on sale of treasury stock as additionsto or deductions from income.(c) Dividends received on treasury stock as income.

Q: "If management wishes to capitalize part of the earnings, it may issue a" share dividend.…

A: Dividend are the share or part of profits that is being distributed or divided to the shareholders…

Q: When an investor uses the equity method to account for investments in common stock, cash dividend…

A: 1. Equity method - Under an Equity method of accounting following entries and changes are made every…

Q: According to the law, dividends may be funded from A. past earnings. B. current earnings. C. past…

A: The dividend distribution decision is an important decision for an organization. The dividend is a…

Q: Describe the role that dividends and capital gains play in delivering returns to common stock…

A: A dividend is a payment made to stakeholders by a corporation. When a company makes a profit or has…

Q: Restricted retained earnings by making an entry equal to the cost of treasury shares purchased.

A: Shareholder Equity- The amount invested by shareholders in a specific organization is referred to as…

Q: When an investor uses the equity method to account for investments in common stock, the investor’s…

A: Identify the appropriate answer for the given statement from the given choices. When an investor…

Q: How does the purchase of treasury stock affect the purchaser’s assets and total equity?

A: Treasury stock: It can be defined as the stock that is repurchased or bought back by the issuing…

Q: The sale of stock and the sale of bonds are reported as financing activities. Are payments of…

A: Statement of cash flows: This statement reports all the cash transactions which are responsible for…

Q: Define the term "treasury stock." What are the reasons for a company to purchase treasury stock?…

A: Here is the answer :

Q: When treasury stock is sold below cost, the Paid-in Capital, Treasury Stock account is debited for…

A: Treasury stock refers to previously issued stock that the issuing business buys back from…

Q: For fi nancial assets classifi ed as trading securities, how are unrealized gains and losses refl…

A: Trading securities are debt or equity assets that management expects to aggressively sell for gain…

Q: When common stock is issued at an amount greater than par value, the difference between the par…

A: When common stock is issued for more than its par value, the difference between par value and…

Q: mount of dividends that a corporation may declare? a. Cash flow test b. Book value test c.…

A: The right answer is d. Income to expense ratio test

Q: Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio…

A: Journal entries refer to the recording of transactions in an appropriate way. With the help of…

Q: Which of the following is most likely true regarding payment of dividends? a. Dividends may be paid…

A: The question is a multiple choice question. Required to identify the most likely true in regarding…

Q: Discuss the accounting treatment or disclosure that should be accorded a declared but unpaid cash…

A:

Q: The statement of stockholders equity does not include -retained earnings -equity method investments…

A: The statement of stockholders equity is part of the financial statement balance sheet. It depicts…

Q: e element in the accumulated other comprehensive income section of shareholders' equity. is reported…

A: Available-for-sale securities are debt or equity investments purchased with an intent to sell them…

Q: For fi nancial assets classifi ed as trading securities, how are unrealized gains and losses refl…

A: Financial assets classified as trading securities can be defined as the assets which can be realized…

Q: For accounting purposes, the method used to account for investments in common stock is determined…

A: If a firm invests in common stock (Equity) then, Required, For the purpose of its Accounting, the…

Q: Trading securities, by definition, are properly classified in the statement of financial position…

A: Statement of financial position is also known as balance sheet, which is prepared at the year-end to…

Q: The cost of dividend payable on redeemable preference shares should be included in______. Select…

A: Redeemable preference shares are those preference shares that will be repaid or redeemed after some…

Q: Distinguish between a stock split and a stock dividend. Isthere any reason for the difference in…

A: Stock splits: Stock split is the increase in number of shares due to splitting or decreasing par…

Q: Why dividends are not deductible?And what could be the order of priority regarding income and assets…

A: Dividends: It refers to the that part of the profit that is given to common shareholders. It is…

Q: When treasury stock accounted for by the cost method is subsequently sold for more than its purchase…

A: Treasury stock refers to the shares which were bought back by the issuing company which was…

Q: When a business has Available-for-Sale Securities, the account Unrealized Loss on Available-for-Sale…

A: Available-for-sale securities Available-for-securities are referred to as equity or debt security…

Q: How is the accounting for a purchase of a company’s own stock (treasury stock) different from the…

A: A company’s stock is the shares a company holds or the shares on which a company has its ownership…

Q: Treasury stock should be reported as

A: Option b is wrong because treasury stocks are not fixed assets. Option c is wrong because treasury…

Q: Which of the following is not a financing activity: O Issuance of bonds payable O Sale of investment…

A: Introduction: Statement of cash flows: All cash in and out flows are recorded in statement of cash…

Q: he primary purpose of the Balance Sheet is to reflect: a. Firm’s potential for growth in stock…

A: Solution: The primary purpose of the Balance Sheet is to reflect " Firm’s resources and how they…

Q: The dividend to general unsecured creditors is the dividend rate declared on common stock multiplied…

A: The individuals or institutions that lend money to the company without any collateral security are…

Q: Indicate whether the following statements are true or false. If the statementis false, explain…

A: Introduction: Capital gain is referred as any profit or gain that coming from the sale of a ‘capital…

Q: cost of holding inventory *

A: 1st answer :- Cost of Debt 2nd answer :- Carrying cost

Q: Where can authoritative IFRS be found related to dilutive securities, stock-based compensation, and…

A:

Q: The receipt of dividends from long-term investments in stock in classified as a canh infow from…

A: The cash flow statement keeps the record of cash inflow or outflow from the business under various…

Q: What is the accounting for treasury share transactions?    a. Treasury shares are accounted for as…

A: Answer) The correct answer in the given question is: (c) On re-issuance of treasury shares, a gain…

Q: Treasury Stock is a(n) * O contra asset account. O retained earnings account. asset account. contra…

A: Solution: Treasury stock is a "contra stockholders' equity account".

Q: The journal entry to record the sale of treasury stock might include a.a credit to Treasury Stock.…

A: Treasury stock indicates the amount of stock repurchased by the company from the stockholders. It is…

Q: Which of the following is an appropriate presentation of treasury stock? O As a marketable security…

A: Treasury stock is the amount of shares repurchased by the company.

Q: Which of the following is a financial liability? a. Deferred revenue b. A warranty obligation c. A…

A: Solution Concept As per the relevant accounting standard Financial liability is…

Q: If stock is issued for an asset other than cash, the asset should be recorded on the books of the…

A: The company has the option to issue the stock for purchasing the assets. In that case, that case the…

Q: accounting treatment or disclosure that should be accorded a declared but unpaid cash dividend; an…

A:

Q: Which of the following is not a method that may be used to account for treasury shares? a. Cost…

A: The treasury shares are the shares which are reacquired by the issuing company from the…

Q: . Unrealized gains and losses on investments in trading securities are reported a. as a current…

A: Trading securities are securities that can be sold immediately in the open market. These securities…

Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.