M8–22. Identifying Financial statement Effects of Stock Issuance and Repurchase (LO1).

On January 1, Bartov Company issues 7,000 shares of $100 par value preferred stock at $250 each per share. On March 1, the company repurchases 7,000 shares of previously issued $1 par value common stock at $92 cash per share. Use the financial statement effects template to record these two transactions.

Date / Description / Post ref / Debit / Credit
Jan 1 / Cash / $1,750,000
Preferred stock / $700,000
Additional paid-in capital, preferred stock / $1,050,000
7,000 shares of preferred stock issued
March 1 / Common stock, $1 par value / $7,000
Additional paid-in capital / $637,000
Treasury stock / $644,000
7,000 shares of common stock repurchased
Balance Sheet / Income Statement
Transaction / Cash Asset / Noncash Asset / Liability / Contri Capital / Earned capital / Revenue / Expense / Net Income

M8-24 Reconcile Common Stock and Treasury Stock Balances

Following is the stockholders equity section from the Abercrombie & Fitch Co balance sheet

Stockholders’ equity
($ thousands except par value amounts) / February 2, 2013 / January 28, 2012
Class A common Stock – 001 par value; 150,000 shares authorized and 103,300 shared issued at each of February 2, 2013 and January 28, 2012 / 1,033 / 1,033
Paid in Capital / 403,271 / 369,171
Retain earnings / 2,567,261 / 2,389,614
Accumulated other comprehensive (loss) income, net of tax / (13,288) / 6,291
Treasury stock at average cost: 24,855 and 17,662 shares at February 2, 2013 and January 28, 2012 respectively / (1,140,009) / (834,774)
Total stockholders equity / 1,818,268 / 1,931,335
  1. Show the computation to yield that $1,033 balance reported for common stock.
  2. How many shares are outstanding at 2013 fiscal year-end

E8-34. Identifying and analyzing financial statement effects of stock transaction (LO1)

Lipe company reports the following transactions relating to its stock accounts in the current year

Feb 20 - Issued 10,000 shares of $1 par value common stock at $20 cash per share

Feb 21 - Issued 15,000 shares of $100 par value, 8% preferred stock at $250 cash per share

June 30 – Purchased 3,000 shares of its own common stock at $15 cash per share

Sep 25 – Sold 1,500 shares of its treasury stock at $18 cash per share

Balance Sheet / Income Statement
Transaction / Cash Asset / Noncash Asset / Liability / Contri Capital / Earned capital / Revenue / Expense / Net Income
Feb 20 - Issued 10,000 shares of $1 par value common stock at $20 cash per share / 100,000
Feb 21 - Issued 15,000 shares of $100 par value, 8% preferred stock at $250 cash per share
June 30 – Purchased 3,000 shares of its own common stock at $15 cash per share
Sep 25 – Sold 1,500 shares of its treasury stock at $18 cash per share

E8-40. Analyzing Cash Dividends on Preferred and common Stock (LO2).

Skinner Company began business on June 30, 2012. At that time it issued 18,000 shares of $50 par value, 8% cumulative preferred stock and 100,000 shares of $10 par value common stock. Through the end of 2014, there has been no change in the number of preferred and common shares outstanding

  1. Assume that Skinner declared and paid cash dividend of $84,000 in 2012, $0 in 2013 and 378,000 in 2014. Compute the total cash dividends and the dividends per share paid to each class of stock in 2012, 2013 and 2014.
  2. Assume that Skinner declared and paid cash dividend of $0 in 2012, 144,000 in 2013 and $189,000 in 2014 Compute the total cash dividends and the dividends per share paid to each class of stock in 2012, 2013 and 2014