Effects of equity transactions on financial statements
Questions
- Issued cumulative preferred stock for cash.
- Issued common stock for cash.
- Distributed a 2 for 1 stock split on the common stock.
4. Issued noncumulative preferred stock for cash.
5. Appropriated retained earnings.
6. Sold treasury stock for an amount of cash that was more than the cost of the treasury stock.
7. Distributed stock dividends.
8. Paid cash to purchase treasury stock.
9. Declared a cash dividend.
10. Paid the cash dividend declared in Event
Effects of equity transactions on financial statements
| Event No. | Assets | Liabilities | Equity | Revenue | Expenses | Net income | Cash flow |
| 1 | (+) | NA | (+) | NA | NA | NA | FA(+) |
| 2 | (+) | (+) | (-) | NA | NA | (+) | FA(+) |
| 3 | NA | (+) | (+) | NA | NA | NA | OA |
| 4 | NA | (+) | (+) | NA | NA | (+) | FA(-) |
| 5 | NA | (-) | (-) | NA | NA | NA | OA(-) |
| 6 | (-) | NA | NA | (+) | NA | (+) | IA(-) |
| 7 | NA | (-) | (-) | NA | NA | (-) | FA(-) |
| 8 | (+) | NA | (-) | (-) | NA | (-) | FA(-) |
| 9 | NA | (+) | NA | (-) | (+) | (-) | IA(-) |
| 10 | NA | NA | NA | (-) | (+) | (-) | (FA)(-) |
(Drucker, 1999)
(Kieso, Weygandt & Warfield, 2007)
References
Drucker, F. (1999) Management Challenges of the 21st Century. New York: Harper Business,
Kieso, D. E., Weygandt, J. J., & Warfield, T. D. (2007) Intermediate Accounting (12th Ed.). Hoboken, NJ: John Wiley & Sons,
