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Unformatted text preview: Contra-equity account (debit balance) Reduces stockholders equity and assets If sold above, paid-in capital from treasury stock transactions is credited Suppose a company purchased 10,000 shares of its own $1 par common stock for $200,000 Later, the company resells the treasury shares for $250,000 Retained Earnings Balance = Net incomes net losses dividends declared Accumulated earnings the company keeps Not a reservoir of cash Normal credit balance Debit balance = Deficit Losses and dividends exceed earnings Dividends Distribution to stockholders Three forms Cash Stock Noncash assets...
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- Spring '11
- Financial Accounting