ECQ Take-home Assignment 2

Acctg 2: Accounting for Partnership and Corporation

1. What are the two components of shareholder’s equity? Discuss each briefly.
2. What is legal capital? How it is measured?
3. What is meant by “share capital”?
4. What are the two classes of share capital? Define each.
5. How do authorized, issued, subscribed, outstanding and treasury shares differ from one
another?
6. Distinguish share of stock and certificate of stock
7. What are the two methods of accounting for share capital? Discuss each briefly
8. What are treasury stocks? Cite some reasons for their purchase.
9. The treasury stocks may be retired instead of reissued. In case of a “loss” on retirement, what is
the order of priority in debiting the “loss”?
10. What is the accounting treatment of donated assets and shares?