Indicate the effects of the transaction
Not what you're looking for?
Indicate the effects of the transaction on each of the following: net profit, retained earnings, total stockholders' equity. Use + to indicate an increase, - to indicate a decrease, and 0 to indicate no effect
(1) A stock dividend is declared and paid
(2) Merchandise is purchased on credit
(3) Marketable securities are sold above cost
(4) Account receivable are collected
(5) A cash dividend is declared and paid
(6) Treasury stock is purchased and recorded at cost
(7) Treasury stock is sold above cost
(8) Common stock is sold
(9) A fixed asset is sold for less than book value
(10) Bonds are converted into common stock
** See ATTACHED file(s) for complete details **
Purchase this Solution
Solution Summary
The effects of the transactions are indicated.
Solution Preview
Indicate the effects of the transaction on each of the following: net profit, retained earnings, total stockholders' equity. Use + to indicate an increase, - to indicate a decrease, and 0 to indicate no effect
(1) A stock dividend is declared and paid: It results in reduction of Retained earning only. Total stock holders' equity does not change.
(2) Merchandise is purchased on credit: Account payable is increased and inventory is also increased. Revenue accounts not affected, therefore no change in Net income, Retained earnings and Owners equity.
(3) Marketable securities are sold above cost: Profit on sale comes under other revenues in ...
Purchase this Solution
Free BrainMass Quizzes
Employee Orientation
Test your knowledge of employee orientation with this fun and informative quiz. This quiz is meant for beginner and advanced students as well as professionals already working in the HR field.
Basics of corporate finance
These questions will test you on your knowledge of finance.
Understanding the Accounting Equation
These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.
MS Word 2010-Tricky Features
These questions are based on features of the previous word versions that were easy to figure out, but now seem more hidden to me.
Situational Leadership
This quiz will help you better understand Situational Leadership and its theories.