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  • The Following Shareholders Equity Accounts Are Reported by Branch Inc

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    Bube Kachevska
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    Branch Inc. reported common shares of $2.4 million, preferred shares of $375,000, and contributed surplus and retained earnings of $1.3 million as of January 1. Throughout the year, Branch Inc. issued additional common shares, reacquired some common and preferred shares, split common shares, and declared a common stock dividend. By December 31, the balances of shareholders' equity accounts had changed as a result of these transactions.

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    The Following Shareholders Equity Accounts Are Reported by Branch Inc

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    Branch Inc. reported common shares of $2.4 million, preferred shares of $375,000, and contributed surplus and retained earnings of $1.3 million as of January 1. Throughout the year, Branch Inc. issued additional common shares, reacquired some common and preferred shares, split common shares, and declared a common stock dividend. By December 31, the balances of shareholders' equity accounts had changed as a result of these transactions.

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    29 views2 pages

    The Following Shareholders Equity Accounts Are Reported by Branch Inc

    Uploaded by

    Bube Kachevska
    Branch Inc. reported common shares of $2.4 million, preferred shares of $375,000, and contributed surplus and retained earnings of $1.3 million as of January 1. Throughout the year, Branch Inc. issued additional common shares, reacquired some common and preferred shares, split common shares, and declared a common stock dividend. By December 31, the balances of shareholders' equity accounts had changed as a result of these transactions.

    Copyright:

    © All Rights Reserved
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    of 2

    The following shareholders equity accounts are reported

    by Branch Inc #8674

    The following shareholders' equity accounts are reported by Branch Inc. on January 1:

    Common shares (unlimited authorized, 150,000 issued)..................................$2,400,000

    Preferred shares ($4 cumulative, convertible, 100,000 authorized, 5,000 issued).........375,000

    Contributed surplus-reacquisition of common shares..........................................30,000

    Retained earnings.................................................................................1,275,000

    The following selected transactions occurred during the year:

    Feb. 11 Issued 50,000 common shares at $20 per share.

    Mar. 2 Reacquired 20,000 common shares at $22 per share.

    June 14 Split the common shares 2 for 1 when the common shares were trading at $30 per
    share.

    July 25 Reacquired 500 preferred shares at $70 per share.

    Sept. 16 Reacquired 50,000 common shares for $17 per share.

    Oct. 27 Declared a 5% common stock dividend distributable on December 13 to shareholders of


    record on November 24. The fair value of the common shares on October 27 was $19 per
    share.

    Dec. 13 Distributed the stock dividend declared on October 27. The fair value of the common
    shares on December 13 was $21 per share.

    Instructions

    (a) Prepare journal entries for the transactions.

    (b) Show how each class of shares will be presented in the shareholders' equity section of the
    balance sheet at December 31.

    TAKING IT FURTHER

    Why is the Contributed Surplus account reported in shareholders' equity?

    1/2
    The following shareholders equity accounts are reported by Branch Inc

    ANSWER
    http://paperinstant.com/downloads/the-following-shareholders-equity-accounts-are-reported-by-
    branch-inc/

    2/2
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