in previous question) d. Define "distributions to owners" and provide examples of this type of transaction. What financial statement element other than equity is typically affected by distributions? e. What are examples of changes within owners' equity that do not
Statements of Financial Accounting Concepts set forth
Instructions:
Answer the following questions based on SFAC No. 6:
(a-c have already been answered in previous question)
d. Define "distributions to owners" and provide examples of this type of transaction. What financial statement element other than equity is typically affected by distributions?
e. What are examples of changes within owners' equity that do not change the total amount of owners' equity?
- Equity is the number of funds contributed by the, it is also known as stockholder's equity. Equity is presented in the balance sheet and calculated by subtracting liabilities from liabilities.
Accounting equation for equity = Assets - Liability
- Following financial elements are effected -
- With the investment Cash/Bank balance will increase and equity will increase
- On distribution as a dividend, Cas/bank will reduce and Reserve and surplus will also get reduced.
- "Excess value over par" account will be shown if the amount received is more than the par value of the share.
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