Stocks And Bonds

Question 1

Compensation. Expense stock options

Answer 1

Reportable fair value ratably over the vesting period.

Question 2

Treasury Stock

Answer 2

Lowers Cash
lowers Owners Equity
Contra owner equity Non Asset Non Investment
Income never affected
Retain Earnings can be decreased but never increased
EPS is increased.

Question 3

Trading security

Answer 3

Balance Sheet - Current Asset @ FMV

Income Statement - treatise and I realize gains and loss interest income

Question 4

Stock dividend

Answer 4

Debit retain earnings
Credit common stock
Credit APIC

Question 5

Dilutive vs anti dilutive securities

Answer 5

Option price > market price = antidilutive

Not included in EPS calculation of anti dilutive

Question 6

Treasury Stock - Cost Method

Answer 6

Reissued

At a price = cost | No APIC
Price > Cost | Increase APIC Treasury /credit
Price < Cost | Dec Apic Treasury Stock / Debit
Dec Retain Earnings / Debit

All Transactions are required at the original requisition cost.

Question 7

Treasury Stock Transactions

Answer 7

Retain Earnings is never credited