{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Chapter 1 - Solution Manual

There is no essential difference between the

Info iconThis preview shows pages 16–17. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: There is no essential difference between the following: [ARB 43, paragraph Ch. 1B Par. 7, sequence 118.2.1] ] a. [The repurchase and retirement of a corporation's own common stock and the subsequent issue of common shares [ARB 43, paragraph Ch. 1B Par. 7, sequence 118.2.2.1] ] b. [The repurchase and resale of its own common stock. [ARB 43, paragraph Ch. 1B Par. 7, sequence 118.2.2.2] ] 505-30-25-8 [Even though there may be cases where the transactions involved are so inconsequential as to be immaterial, as a broad general principle, such transactions shall not be reflected in retained earnings (either directly or through inclusion in the income statement). [ARB 43, paragraph Ch. 1B Par. 10, sequence 126] ][ The qualification shall not be applied to any transaction that, although in itself inconsiderable in amount, is a part of a series of transactions that in the aggregate are of substantial importance. [ARB 43, paragraph Ch. 1B Par. 11, sequence 127] ] 505-30-25-9 [The difference between the repurchase and resale prices of a corporation's own common stock shall be reflected as part of the capital of a corporation and allocated to the different components within stockholder equity as required by paragraphs 505-30-30-5 through 30-10. [ARB 43, paragraph Ch. 1B Par. 5, sequence 116] ] Allocating the Cost of Treasury Shares to Components of Shareholder Equity Upon Formal or Constructive Retirement 505-30-30-6 [Once the cost of the treasury shares is determined under the requirements of this Section, and if a corporation's stock is acquired for purposes other than retirement (formal or constructive), or if ultimate disposition has not yet been decided, paragraph 505-30-45-1 permits the cost of acquired stock to either be shown separately as a deduction from the total of capital stock, additional paid-in capital, and retained earnings, or be accorded the following accounting treatment appropriate for retired stock. [ARB 43, paragraph Ch. 1B Par. 7, sequence 122.1] ] 505-30-30-7 [The difference between the cost of the treasury shares and the stated value of a corporation's common stock repurchased and retired, or repurchased for constructive retirement, shall be reflected in capital. [ARB 43, paragraph Ch. 1B Par. 7, sequence 118.1] ] 505-30-30-8 [When a corporation's stock is retired, or repurchased for constructive retirement (with or without an intention to retire the stock formally in accordance with applicable laws), [ARB 43, paragraph Ch. 1B Par. 7, sequence 119] ][ an excess of repurchase price over par or stated value may be allocated between additional paid-in capital and retained earnings. [ARB 43, paragraph Ch. 1B Par. 7, sequence 120.1.1] ][ Alternatively, the excess may be charged entirely to retained earnings in recognition of the fact that a corporation can always capitalize or allocate retained earnings for such purposes. [ARB 43, paragraph Ch. 1B Par. 7, sequence 120.2.2.2.2] ][ If a portion of the excess is allocated to additional 43, paragraph Ch....
View Full Document

{[ snackBarMessage ]}

Page16 / 27

There is no essential difference between the following[ARB...

This preview shows document pages 16 - 17. Sign up to view the full document.

View Full Document Right Arrow Icon bookmark
Ask a homework question - tutors are online