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Flashcards in Stockholders Equity Deck (21)
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1
Q

Subscribed capital stock (calls) presented in the SFS

A

as a contra account in the equity section

2
Q

Conversion of preferred shares

A

BOOK VALUE method is used

3
Q

Convertible Debt

A

record liability at fv and residual amount to equity

4
Q

Donated assets

A

IFRS doesn’t have any rule

5
Q

Accounting for treasury stocks - 3 methods

A

cost, par value and

constructive retirement method-same as par but reacquired shares charged to the share account not treasury stock

6
Q

Share based payments- 3 categories

A

equity settled
cash settled
choice to settle in cash or equity

7
Q

Shareholder’s Equity components

A
Common stock
Preference shares
Share premium
Reserves
Treasury shares
Accumulated other comprehensive income-DENTR
Non controlling interests
8
Q

Intrinsic value of stock options

A

If no observable market price of the option, compute compensation expense as:

$60 exercise price
option to purchase at 70% of exercise price

Exercise price (x% discount if there is)
minus exercise price
= intrinsic value of option
x # of options shares
= amount to record as compensation expense

9
Q

Computation of contributed capital

A

Total all CS, PS, all APIC balances.

Do not include treasury stock transactions/journal entries in the computation

10
Q

In IFRS, when preferred shares are converted into common shares, what method is used?

A

only book value method

11
Q

Convertible bonds - how to compute for the liability?

A

FAIR VALUE OF THE LIABILITY COMPONENT AND THE RESIDUAL TO EQUITY COMPONENT

12
Q

Declaration of dividends in IFRS

A

if dividends is proposed - REPORT in the notes

if declared after end of period but before the issuance of FS - DISCLOSE in the notes

13
Q

ORDINARY AND PREFERRED SHARES ISSUED AS A UNIT, HOW TO ACCOUNT FOR THE VALUES?

A

in proportion to their relative fair values.

if only one security is valued at fv, residual is to the other security

if non, use appraisal values

14
Q

Subscription receivables -

A

accounting depends on the jurisdiction

Current or non current asset based o n due date
OR
contra account to SE

15
Q

How are DONATED ASSETS accounted for in IFRS?

A

NO DONATED ASSETS IN IFRS

16
Q

3 Methods in accounting for treasury stock

A

par value, cost method and constructive retirement method

17
Q

Constructive retirement method

A

when the entity does not have intention to resell the shares

reacquired shares are charged to CS not TS

18
Q

Preference shares redeemable at the option of the holder - how are they accounted?

A

classified as liabilities

19
Q

3 categories of share based payments

A

equity settled
cash settled
choice of cash or equity

20
Q

Equity settled share based payments to NON employees

A

use fv of goods or services received
OR
fv of equity securities issued

21
Q

Equity settled share based payments to employees

A

AT FAIR VALUE OF SECURITY