Intermediate Accounting
9th Edition
ISBN: 9781259722660
Author: J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher: McGraw-Hill Education
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Question
Chapter 18, Problem 18.10E
To determine
Retired stock:
Buy back of shares from the shareholders by paying cash and obtaining the status of “authorized but unissued share” is known as retired shares.
To Journalize: The transactions for B Communications.
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Exercise 18-10 (Static) Retirement of shares [LO18-5]
Borner Communications' articles of incorporation authorized the issuance of 130 million common shares. The transactions described
below.effected changes in Borner's outstanding shares. Prior to the transactions, Borner's shareholders' equity included the following:
Shareholders' Equity
Common stock, 100 million shares at $1 par
Paid-in capital excess of par
Retained earnings
($ in millions)
$100
300
210
Required:
Assuming that Borner Communications retires shares it reacquires (restores their status to that of authorized but unissued shares).
record the appropriate journal entry for each of the following transactions: (If no entry is required for a transaction/event, select "No
Journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
1. On January 7, 2021, Borner reacquired 2 million shares at $5 per share.
2. On August 23, 2021, Borner reacquired 4 million…
Exercise 19-24 (Algo) New shares; contingently issuable shares [LO19-6,19-12]
During 2024, its first year of operations, Kevin Berry Industries entered into the following transactions relating to shareholders’ equity. The corporation was authorized to issue 100 million common shares, $1 par per share.
January 2
Issued 75 million common shares for cash.
January 2
Entered an agreement with the company president to issue up to 2 million additional shares of common stock in 2025 based on the earnings of Berry in 2025. If net income exceeds $120 million, the president will receive 1 million shares; 2 million shares if net income exceeds $130 million.
March 31
Issued 4 million shares in exchange for plant facilities.
Net income for 2024 was $125 million.
Required:
Compute basic and diluted earnings per share for the year ended December 31, 2024.
Note: Do not round intermediate calculations. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).
Exercise 19-24 (Algo) New shares; contingently issuable shares [LO19-6,19-12]
During 2024, its first year of operations, Kevin Berry Industries entered into the following transactions relating to shareholders' equity.
The corporation was authorized to issue 100 million common shares, $1 par per share.
January 2 Issued 55 million common shares for cash.
January 2 Entered an agreement with the company president to issue up to 2 million additional shares of common stock in
2025 based on the earnings of Berry in 2025. If net income exceeds $140 million, the president will receive 1
million shares; 2 million shares if net income exceeds $150 million.
March 31 Issued 4 million shares in exchange for plant facilities.
Net income for 2024 was $148 million.
Required:
Compute basic and diluted earnings per share for the year ended December 31, 2024.
Note: Do not round intermediate calculations. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).
Basic
Diluted
Numerator
+
+…
Chapter 18 Solutions
Intermediate Accounting
Ch. 18 - Identify and briefly describe the two primary...Ch. 18 - Prob. 18.2QCh. 18 - Prob. 18.3QCh. 18 - Prob. 18.4QCh. 18 - Prob. 18.5QCh. 18 - Prob. 18.6QCh. 18 - Prob. 18.7QCh. 18 - What is meant by a shareholders preemptive right?Ch. 18 - Terminology varies in the way companies...Ch. 18 - Most preferred shares are cumulative. Explain what...
Ch. 18 - The par value of shares historically indicated the...Ch. 18 - Prob. 18.12QCh. 18 - How do we report components of comprehensive...Ch. 18 - The balance sheet reports the balances of...Ch. 18 - At times, companies issue their shares for...Ch. 18 - Prob. 18.16QCh. 18 - The costs of legal, promotional, and accounting...Ch. 18 - When a corporation acquires its own shares, those...Ch. 18 - Discuss the conceptual basis for accounting for a...Ch. 18 - The prescribed accounting treatment for stock...Ch. 18 - Brandon Components declares a 2-for-1 stock split....Ch. 18 - What is a reverse stock split? What would be the...Ch. 18 - Suppose you own 80 shares of Facebook common stock...Ch. 18 - Prob. 18.24QCh. 18 - Comprehensive income LO181 Schaeffer Corporation...Ch. 18 - Stock issued LO184 Penne Pharmaceuticals sold 8...Ch. 18 - Prob. 18.3BECh. 18 - Prob. 18.4BECh. 18 - Prob. 18.5BECh. 18 - Retirement of shares LO185 Agee Storage issued 35...Ch. 18 - Treasury stock LO185 The Jennings Group...Ch. 18 - Prob. 18.8BECh. 18 - Prob. 18.9BECh. 18 - Cash dividend LO188 Real World Financials...Ch. 18 - Effect of preferred stock on dividends LO187 The...Ch. 18 - Property dividend LO187 Adams Moving and Storage,...Ch. 18 - Stock dividend LO188 On June 13, the board of...Ch. 18 - Prob. 18.14BECh. 18 - Stock split LO188 Refer to the situation...Ch. 18 - Prob. 18.16BECh. 18 - Comprehensive income LO182 The following is from...Ch. 18 - Prob. 18.2ECh. 18 - Earnings or OCI? LO182 Indicate by letter whether...Ch. 18 - Stock issued for cash; Wright Medical Group LO184...Ch. 18 - Issuance of shares; noncash consideration LO184...Ch. 18 - Prob. 18.6ECh. 18 - Share issue costs; issuance LO184 ICOT Industries...Ch. 18 - Reporting preferred shares LO184, LO187 Ozark...Ch. 18 - Prob. 18.9ECh. 18 - Prob. 18.10ECh. 18 - Retirement of shares LO185 In 2018, Borland...Ch. 18 - Treasury stock LO185 In 2018, Western Transport...Ch. 18 - Treasury stock; weighted-average and FIFO cost ...Ch. 18 - Prob. 18.14ECh. 18 - Prob. 18.15ECh. 18 - Prob. 18.16ECh. 18 - Transact ions affecting retained earnings LO186,...Ch. 18 - Effect of cumulative, nonparticipating preferred...Ch. 18 - Stock dividend LO188 The shareholders equity of...Ch. 18 - Prob. 18.20ECh. 18 - Cash in lieu of fractional share rights LO188...Ch. 18 - Prob. 18.22ECh. 18 - Transact ions affecting retained earnings LO186...Ch. 18 - Profitability ratio LO181 Comparative balance...Ch. 18 - Prob. 18.25ECh. 18 - Various stock transactions; correction of journal...Ch. 18 - Share buybackcomparison of retirement and treasury...Ch. 18 - Reacquired sharescomparison of retired shares and...Ch. 18 - Prob. 18.4PCh. 18 - Shareholders equity transactions; statement of...Ch. 18 - Prob. 18.6PCh. 18 - Prob. 18.7PCh. 18 - Prob. 18.8PCh. 18 - Effect o f preferred stock characteristics on...Ch. 18 - Prob. 18.10PCh. 18 - Stock dividends received on investments;...Ch. 18 - Various shareholders equity topics; comprehensive ...Ch. 18 - Prob. 18.13PCh. 18 - Prob. 18.1BYPCh. 18 - Prob. 18.2BYPCh. 18 - Research Case 184 FASB codification; comprehensive...Ch. 18 - Judgment Case 185 Treasury stock; stock split;...Ch. 18 - Prob. 18.6BYPCh. 18 - Prob. 18.7BYPCh. 18 - Prob. 18.8BYPCh. 18 - Prob. 1CCTC
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