Interactive Tutorial: Dollar Value LIFO
Narrator: Many companies maintain two sets of records, one for external reporting, and
one for internal reporting. Often these companies will use LIFO for tax and external
reporting, but another method
Chapter 15 Learning Objective 9: Indicate how to present and analyze stockholders' equity.
Illustration 15-13 shows a comprehensive stockholders' equity section from the balance sheet of
Frost Company that includes most of the equity items we discussed in
Chapter 15 Learning Objective 8: Explain the accounting for small and large stock dividends,
and for stock splits.
With a stock dividend, the company distributes no assets. A stock dividend therefore is the
issuance by a corporation of its own stock to it
How to Account for the Buying and Reselling Treasury Stock
In this video, we will see how the buying and reselling treasury stock is accounted for in the books.
Treasury stock is stock that a corporation has issued and then reacquired. Purchase of
How to Calculate the Balance in Retained Earnings
In this video, we will see how the balance in retained earnings is computed.
The stockholders equity normally has three categories: capital stock, additional paid-in capital, and
Chapter 15 Learning Objective 6: Describe the policies used in distributing dividends.
Determining the proper amount of dividends to pay is a difficult management decision. Very
few companies pay dividends in amounts equal to their legally available retai
How to Account for the Issuance of Preferred Stock, Conversion of Preferred Stock, and Preferred
In this video, we will see how the issuance of preferred stock, conversion of preferred stock, and
preferred stock dividends are accoun
This problem is about the stockholders' equity section and dividends. So, it tells us that
the company has different types of instruments. $2,500,000 of Preferred stocks paying at 12%
dividend. 12% of $2,500,000 has 25,000 preferred shares. $300,000 commo
In this problem, we have various journal entries involving the issuance of common stock.
In part a. on April 26, issued 15,000 shares for cash at $4.50 per share. We debit Cash for 15,000 shares, times $4.50, we credit Common Stock at 15,000
shares at $1
Chapter 15 Learning Objective 2: Identify the key components of stockholders equity.
Owners equity in a corporation is defined as stockholders equity, shareholders equity, or
corporate capital. Three categories normally appear as part of stockholders equi
How to Prepare Journal Entries to Account for Cash and Liquidating Dividends
In this video, we will see how cash and liquidating dividends are accounted for in the books.
Dividends can be of four types: cash dividends, property dividends, liquidati
How to Record Journal Entries for the Issuance of Common Stock
In this video, we will see how issuance of common stock is recorded.
To show the required information for issuance of par value stock, corporations use the Preferred
Stock or Common Sto
Chapter 15 Learning Objective 5: Explain the accounting for and reporting of preferred stock.
As noted earlier, preferred stock is a special class of shares that possesses certain preferences or
features not possessed by common stock. The following featur
Chapter 15 Learning Objective 7: Identify the various forms of dividend distributions.
Companies generally base dividend distributions either on accumulated profits, that is retained
earnings, or on some other capital items such as additional paid-in capi
How to Compute the Book Value of Common Stock
In this video, we will see how the book value of common stock is computed.
Book value per share is computed by dividing net assets by outstanding shares at the end of the
year. That is, book value per s
In this problem, we have various journal entries for dividends.
In part a The par value of the capital stock is reduced to $0.50 with a two-for-one stock split. There is no journal entry required here. The company uses a
memorandum note to indicate that t
How to Calculate Different Types of Preferred Stock Dividends
In this video, we will see how to calculate different types of preferred stock dividends.
Preferred stock is a special class of shares that possesses certain preferences or features not
Chapter 15 Learning Objective 3: Explain the accounting procedures for issuing shares of stock.
In issuing stock companies follow these procedures, first the state must authorize the stock,
generally in a certificate of incorporation or charter. Next, the
How to Prepare the Stockholders Equity Section of the Balance Sheet
In this video, we will see how the stockholders equity section of the balance sheet is prepared.
The stockholders equity normally has three categories: capital stock, additional pa
Chapter 15 Learning Objective 1: Discuss the characteristics of the corporate form of
Of the three primary forms of business organization, the proprietorship, the partnership and the
corporation, the corporate form dominates. The corporation
How to Prepare Journal Entries to Account for Stock Dividends and Stock Splits
In this video, we will see how stock dividends and stock splits are accounted for in the books.
Stock dividends are dividends not paid in cash but in additional shares o
Chapter 15 Learning Objective 4: Describe the accounting for treasury stock.
Share buybacks now exceed dividends as a form of distribution to stockholders. Corporations
purchase their outstanding stock for several reasons.
To provide tax-efficient distrib
Chapter 10: Acquisition and Disposition of Property, Plant, and Equipment
The Amount for companies capital expenditures are reported on a companys balance sheet and
directly affect such items as total assets, depreciation expense, cash flows and net incom
Chapter 8: valuation of Inventories: A cost-Basis Approach
LIFO provides tax savings, and an income number that better reflects the gross profit associated
with inventories with different historical cost. Although LIFO is not permitted under IFRS, and
Interactive Tutorial: Interest Capitalization
Different Approaches to Treatment of Interest Costs During Construction
Narrator: In this section, our primary objective is to understand the accounting problems
associated with interest capitalization. There
Chapter 8 Learning Objective 1: Identify major classifications of inventory.
Inventory classification Inventories are asset items that a company holds for sale in the
ordinary course of business or goods that it will use or consume in the production of go
Annual lease payment due at the beginning of
each year, beginning with January 1, 2014
Residual value of equipment at end of lease term,
guaranteed by the lessee
Economic life of leased equipment
Fair value of asset at January 1,
future taxable amount
deferred tax liability
80,000 this is a credit to this account, wil go away over time
when the rate changes
future taxable amount
deferred tax liability
1. Net working capital is defined as:
the depreciated book value of a firm's fixed assets.
the value of a firm's current assets.
available cash minus current liabilities.
total assets minus total liabiliti