Question

Reconciling Common Stock and Treasury Stock Balances
Assume this is the stockholders' equity section from the Abercrombie & Fitch balance sheet.

Shareholders' Equity (thousands, except par value amounts)	January 28, 2012	January 29, 2011
Class A common stock-$0.01 par value: 150,000 shares authorized and 104,800shares issues at January 28, 2012, and January 29, 2011, respectively	$ 1,048	$ 1,048
Paid-in capital	319,451	289,732
Retained earnings	2,051,463	1,646,290
Accumulated other comprehensive income (loss), net of tax	7,118	(994)
Treasury stock at average cost: 17,641.116 and 14,999.945 shares at January 28, 2012 andJanuary 29, 2011, respectively	(760,752)	(530,764)
Total shareholders' equity	$ 1,618,328	$ 1,405,312

(a) Show the computation to yield the $1,048 balance reported for common stock. Enter complete number for number of shares (with all zeros).
(Answershares) x ($Answer) = $1,048 thousand

(b) How many shares are outstanding at January 28, 2012?
Answershares

(c) Use the common stock and paid-in capital accounts to determine the average price at which Abercrombie & Fitch issued its common stock. (Round your answer to two decimal places.)
$Answer

(d) Use the treasury stock account to determine the average price Abercrombie & Fitch paid when it repurchased its common shares. (Round your answer to two decimal places.)
$Answer

Answer 1

a) Calculate the computation to yield the $1,048 balance reported for common stock.

Given answer As per question =  $1,048 thousand

= (104800*1000)*$.01

=( 104,800,000)* 0.1

= $10,480,000

Final answer 104,800,00 x 0,01=   $1,048 thousand

b) Calculate  shares are outstanding at January 28, 2012?

Given share - Treasury stock at average cost

104800000-17641116

= 87158884

87158884 is the shares are outstanding at January 28, 2012

c) Calculating by Use the common stock and paid-in capital accounts to determine the average price at which Abercrombie & Fitch issued its common stock.

Average price

(1048000+319451000)/104800000

= $ 320,499,000/104800000

=$ 0.30581965649

=$ 3.06

$3.06 is average price at which Abercrombie & Fitch issued its common stock.

d) Calculating by Using the treasury stock account to determine the average price Abercrombie & Fitch paid when it repurchased its common share

$760752000/ $17641116

= $43.12

$43.12 is average price Abercrombie & Fitch paid when it repurchased its common share.

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