WEEK 4: STOCKHOLDERS’ EQUITY
When a company lists its common stock as having a stated par value, then any amount that the stock sells for above the par value is "additional paid-in capital in excess of par." However, if there is no stated par value, such as "no par" or "stated value of zero par," then do you still need to have the account of "additional paid-in capital in excess of par"? If not, then how do you account for this item, or do you?
WEEK 4: CONCEPTUAL ISSUES: EQUITY
Answer one of the questions on CA15-3 on page 823 about Concepts Statement No. 6. Discuss the other concepts with your classmates.
CA15-3 WRITING (Conceptual Issues—Equity) Statements of Financial Accounting Concepts set forth financial accounting and reporting objectives and fundamentals that will be used by the Financial Accounting Standards Board in developing standards. Concepts Statement No. 6 defines various elements of financial statements.
InstructionsAnswer the following questions based on SFAC No. 6.
(a)Define and discuss the term “equity.”
(b)What transactions or events change owners' equity?
(c)Define “investments by owners” and provide examples of this type of transaction. What financial statement element other than equity is typically affected by owner investments?
(d)Define “distributions to owners” and provide examples of this type of transaction. What financial statement element other than equity is typically affected by distributions?
(e)What are examples of changes within owners' equity that do not change the total amount of owners' equity?
When a company lists its common stock as having a stated
Date Published: 16 November, 2017