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level: Equity

Questions and Answers List

level questions: Equity

QuestionAnswer
Participating (PS)Share equally between PS and CS then pro-rata
Outstanding Shares CalculationOutstanding = Issued - TS
Treasury Stock Method: CostCalculated upon reissue. TS gained is based on cost @ reissue
Treasury Stock Method: Par ValueCalculated upon repurchase. TS is gained based on par DR: APIC-CS for difference between par and original cost
How are G/L accounted for with Treasury Stock?Both affect APIC not IS. It will be backed into RE if necessary, but RE will NEVER increase.
When are dividends recorded against RE and when is the payable removed?1) Recorded against RE when declared 2) Payable removed on payment date
How do you account for property dividends?Restate to FV (G/L on IS) then distribute
How do you account for stock dividends?Large Stock Dividend: >20-25% reduce RE by par Small Stock Dividend: <20-25% reduce FMV by par
Non-compensatory Stock Right/WarrantUS GAAP ONLY No JE until stock is purchased (memo only)
Compensatory Stock Right/WarrantUS GAAP/IFRS Required No JE on grant date, expense calculated using FV estimate and allocated during the vesting service period