Chapter 13(a) homework - second semester

Chapter 13(a) homework - second semester - Chapter 13 - SE9...

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Chapter 13 - SE9 Preferred Stock Book Value per share = 1,000 shares x $100 x .08 = $8,000 $116,000 / 1,000 = $116 per share Common Stock Book Value per share = $2,482,000 - $116,000 = $2,366,000 / 80,000 shares = $29.58 per share E -1 1. Looking at the bottom line at a glance can give a misleading positive view of earnings and it should be looked at closely. 2. No as long as the management is staying within the accounting and reporting rules and disclose everything. 3. It can be harder to report and pay for future income taxes based on managements decisions and many believe it should be paid for within the year the taxes occurred. 4. It makes it easier for management to review the current operations and helps to set apart the discountined ops. E-2 1. One way is to reduce the number of shares outstanding with buyback (T-stk) stock. 2. Comprehensive income comes from other items other than the owners themselves. 3. Because it would reduce the net worth fo the stockholder and ownership of the company 4. It would reduce the book value per share because the number of shares outstanding would be increased with increasing total stockholders equity. E3 1. Net income under average-cost inventory $17,000 Difference between FIFO and average-cost inventory 2,500 ($47,500 - $45,000) Net Income under FIFO $19,500 2. Net Income determined under LIFO $17,000 Difference beween average-cost and LIFO inventory (2,000) ($45,000 - $45,000) Net income under LIFO $15,000 3. LIFO is the most consevation because it will produce the lowest
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This note was uploaded on 07/27/2011 for the course ACCT 101 taught by Professor Ronbell during the Spring '11 term at UCSD.

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Chapter 13(a) homework - second semester - Chapter 13 - SE9...

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