Question

In: Accounting

On June 8, Steering Ltd was incorporated and issued 56,000 common shares for $280,000. On August...

On June 8, Steering Ltd was incorporated and issued 56,000 common shares for $280,000. On August 19, an additional 14,000 shares were issued for $84,000. On November 2, the company paid $29,760 to reacquire 6,200 common shares and on December 7 it paid $51,350 to reacquire 7,900 common shares.

Calculate the average cost of the common shares on June 8, August 19, November 2, and December 7.

Solutions

Expert Solution

ans 1 june 8 th
Number of stock value
issue 56000 280,000
therefore average price = 280000/56000 5.00
ans 2 19-Aug
Number of stock value
issue 56000 280,000
additional 14000 84000
70000.0 364000.0
Average price = =364000/70000 5.20
ans 3 2-Nov
Number of stock value
issue 56000 280,000
additional 14000 84000
70000.0 364000.0 5.20
Note : reacquired stock will not impact equity it will be treated as treasury stock
ans 4 7-Dec
Number of stock value
issue 56000 280,000
additional 14000 84000
70000.0 364000.0 5.20
Note : reacquired stock will not impact equity it will be treated as treasury stock

ekkarill92 answered 8 months ago
Next > < Previous

Related Solutions

Gundagai Ltd was incorporated on June 30, 2019. On July 1, 2019, the company issued a...
Gundagai Ltd was incorporated on June 30, 2019. On July 1, 2019, the company issued a prospectus offering 300,000 ordinary shares at an issue price of $10, payable on the following terms. $3 on application $3 on allotment $2 on the first call $2 on the second call A summary of the applications and allotments register follows. Amount paid per share on application Number of shares applied for Number of shares allotted $3.00 200,000 150,000 $6.00 100,000 100,000 $10.00 50,000...
Gundagai Ltd was incorporated on June 30, 2019. On July 1, 2019, the company issued a...
Gundagai Ltd was incorporated on June 30, 2019. On July 1, 2019, the company issued a prospectus offering 300,000 ordinary shares at an issue price of $10, payable on the following terms. $3 on application $3 on allotment $2 on the first call $2 on the second call A summary of the applications and allotments register follows. Amount paid per share on application Number of shares applied for Number of shares allotted $3.00 200,000 150,000 $6.00 100,000 100,000 $10.00 50,000...
15. Lego, Inc., issued common stock in Year 1. It issued 10,000 shares of 8%, $100...
15. Lego, Inc., issued common stock in Year 1. It issued 10,000 shares of 8%, $100 par value cumulative preferred stock for $110 per share at the beginning of Year 4. It did not pay any dividends during Year 4. In December of Year 5, it declares total dividends of $200,000. How much will the preferred stockholders of Lego receive as dividends in Year 5? • $200,000 • $160,000 • $80,000 • $40,000 16. Marine Corporation issued common stock in...
Headland Corporation has 10.60 million shares of common stock issued and outstanding. On June 1, the...
Headland Corporation has 10.60 million shares of common stock issued and outstanding. On June 1, the board of directors voted an 73 cents per share cash dividend to stockholders of record as of June 14, payable June 30. Prepare the journal entries for each of the dates above assuming the dividend represents a distribution of earnings. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the...
Novak Corporation has 11.80 million shares of common stock issued and outstanding. On June 1, the...
Novak Corporation has 11.80 million shares of common stock issued and outstanding. On June 1, the board of directors voted an 82 cents per share cash dividend to stockholders of record as of June 14, payable June 30. 1. Prepare the journal entries for each of the dates above assuming the dividend represents a distribution of earnings. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for...
During the year ended 30 June 2020, Starhub Ltd acquired the following investments in shares issued...
During the year ended 30 June 2020, Starhub Ltd acquired the following investments in shares issued by other companies: M3 Ltd $480 000 (42% of issued capital) Republic Ltd $680 000 (35% of issued capital) Starhub Ltd is unsure how to account for these investments and asked you for some professional advice. Specifically, Starhub Ltd is concerned that it may need to prepare consolidated financial statements under AASB 10. The company provided the following information about the two investee companies:...
On August 31, 20X1, Wood Corp. issued 200,000 shares of its $20 par value common stock...
On August 31, 20X1, Wood Corp. issued 200,000 shares of its $20 par value common stock for the net assets of Pine, Inc. in a business combination accounted for by the acquisition method. The market value of Wood's common stock on August 31 was $45 per share. Wood paid a fee of $200,000 to the consultant who arranged this acquisition. Costs of registering and issuing the equity securities amounted to $150,000. No goodwill was involved in the purchase. What amount...
Lotoya Davis Corporation has 11.44 million shares of common stock issued and outstanding. On June 1,...
Lotoya Davis Corporation has 11.44 million shares of common stock issued and outstanding. On June 1, the board of directors voted an 69 cents per share cash dividend to stockholders of record as of June 14, payable June 30. (a) Prepare the journal entry for each of the dates above assuming the dividend represents a distribution of earnings. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry"...
Royal Park Ltd is an existing company that has issued previously 300,000 ordinary shares of $8...
Royal Park Ltd is an existing company that has issued previously 300,000 ordinary shares of $8 each and 100,000 5% preference shares of $15 each. On 1st January 2019, Royal Park Ltd offered to issue an additional 250,000 ordinary shares for $11, payable in two installments: $7 initially on application; $4 payable based on calls as required. Applications for 400,000 shares were received by the closing date of 30th January 2019. On 10th February 2019, shares were allotted, and a...
Royal Park Ltd is an existing company that has issued previously 300,000 ordinary shares of $8...
Royal Park Ltd is an existing company that has issued previously 300,000 ordinary shares of $8 each and 100,000 5% preference shares of $15 each. On 1st January 2019, Royal Park Ltd offered to issue an additional 250,000 ordinary shares for $11, payable in two installments: $7 initially on application; $4 payable based on calls as required. Applications for 400,000 shares were received by the closing date of 30th January 2019. On 10th February 2019, shares were allotted, and a...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT