Chapter 6 of Win Ballada's Partnership and Corporation Accounting: Everything You Need to Know (Plus Zip File Download)
Partnership and Corporation Accounting 2012 by Win Ballada Chapter 6 Answer Key Free Download.zip
Are you looking for a reliable and comprehensive source of information on partnership and corporation accounting? Do you want to learn how to account for share capital transactions in different scenarios? Do you need help with solving the exercises and problems in Chapter 6 of Win Ballada's book? If you answered yes to any of these questions, then this article is for you.
partnership and corporation accounting 2012 by win ballada chapter 6 answer key free download.zip
In this article, we will explain what partnership and corporation accounting is, who Win Ballada is and what his book covers, and how to access the answer key for Chapter 6 online. We will also provide you with a detailed overview of Chapter 6, which deals with accounting for share capital. We will discuss the types of shares, their characteristics, and how to record their issuance, reacquisition, and retirement. Finally, we will summarize the main points and tell you how you can benefit from using the answer key.
Chapter 6: Accounting for Share Capital
Share capital is the amount of money that a corporation receives from its shareholders in exchange for shares of stock. Share capital represents the ownership interest of the shareholders in the corporation. Shareholders have certain rights and privileges, such as voting, receiving dividends, and sharing in the residual assets of the corporation in case of liquidation.
There are different types of shares that a corporation can issue, depending on its legal structure, preferences, and objectives. Each type of share has its own characteristics, such as par value, no-par value, stated value, voting rights, dividend preferences, etc. The type of share also affects how it is accounted for in the books of the corporation.
In this chapter, we will learn how to account for three types of shares: share capital with par value, share capital without par value, and share capital with stated value. We will also learn how to account for share issuance, reacquisition, and retirement under each type.
Share Capital with Par Value
Par value is the nominal or face value of a share that is assigned by the corporation when it is authorized. Par value has no relation to the market value or intrinsic value of a share. It is usually a very low amount, such as $0.01 or $1 per share.
When a corporation issues shares with par value, it records the cash received at fair market value and credits the share capital account for the number of shares issued multiplied by the par value. The difference between the cash received and the share capital credited is recorded as additional paid-in capital, which represents the excess amount that the shareholders paid over the par value.
For example, suppose ABC Corporation issues 10,000 shares of common stock with a par value of $1 per share for $15 per share. The journal entry to record this transaction is:
Dr. Cash 150,000 Cr. Common Stock 10,000 Cr. Additional Paid-in Capital 140,000
When a corporation reacquires its own shares with par value, it records the cash paid at fair market value and debits the treasury stock account for the same amount. Treasury stock is a contra-equity account that reduces the total shareholders' equity. Treasury stock can be reissued or retired by the corporation.
For example, suppose ABC Corporation reacquires 1,000 shares of its common stock with a par value of $1 per share for $12 per share. The journal entry to record this transaction is:
Dr. Treasury Stock 12,000 Cr. Cash 12,000
When a corporation retires its own shares with par value, it cancels the shares and reduces the share capital and additional paid-in capital accounts by the amounts that were originally recorded when the shares were issued. Any difference between the cash paid and the total reduction in equity is recorded as a gain or loss on retirement.
For example, suppose ABC Corporation retires the 1,000 shares of its common stock with a par value of $1 per share that it reacquired for $12 per share. The original issue price of these shares was $15 per share. The journal entry to record this transaction is:
Dr. Common Stock 1,000 Dr. Additional Paid-in Capital 14,000 Dr. Retained Earnings 3,000 Cr. Treasury Stock 18,000
Share Capital without Par Value
No-par value is a type of share that does not have a specified par value assigned by the corporation. No-par value shares can be issued at any price that the corporation and the shareholders agree on. No-par value shares are more flexible and avoid some legal issues that may arise from issuing shares below par value.
When a corporation issues shares without par value, it records the cash received at fair market value and credits the share capital account for the same amount. There is no additional paid-in capital account for no-par value shares.
For example, suppose XYZ Corporation issues 10,000 shares of common stock without par value for $20 per share. The journal entry to record this transaction is:
Dr. Cash 200,000 Cr. Common Stock 200,000
When a corporation reacquires its own shares without par value, it records the cash paid at fair market value and debits the treasury stock account for the same amount. Treasury stock is a contra-equity account that reduces the total shareholders' equity. Treasury stock can be reissued or retired by the corporation.
For example, suppose XYZ Corporation reacquires 1,000 shares of its common stock without par value for $18 per share. The journal entry to record this transaction is:
Dr. Treasury Stock 18,000 Cr. Cash 18,000
When a corporation retires its own shares without par value, it cancels the shares and reduces the share capital account by the amount that was originally recorded when the shares were issued. Any difference between the cash paid and the reduction in equity is recorded as a gain or loss on retirement.
For example, suppose XYZ Corporation retires the 1,000 shares of its common stock without par value that it reacquired for $18 per share. The original issue price of these shares was $20 per share. The journal entry to record this transaction is:
Dr. Common Stock 20,000 Dr. Retained Earnings 2,000 Cr. Treasury Stock 22,000
Share Capital with Stated Value
Stated value is a type of share that does not have a specified par value assigned by the corporation but has a minimum value that is determined by the board of directors. Stated value shares are similar to par value shares in terms of accounting treatment but avoid some legal restrictions that may apply to par value shares.
When a corporation issues shares with stated value, it records the cash received at fair market Share Capital with Stated Value
Stated value is a type of share that does not have a specified par value assigned by the corporation but has a minimum value that is determined by the board of directors. Stated value shares are similar to par value shares in terms of accounting treatment but avoid some legal restrictions that may apply to par value shares.
When a corporation issues shares with stated value, it records the cash received at fair market value and credits the share capital account for the number of shares issued multiplied by the stated value. The difference between the cash received and the share capital credited is recorded as additional paid-in capital, which represents the excess amount that the shareholders paid over the stated value.
For example, suppose LMN Corporation issues 10,000 shares of common stock with a stated value of $5 per share for $25 per share. The journal entry to record this transaction is:
Dr. Cash 250,000 Cr. Common Stock 50,000 Cr. Additional Paid-in Capital 200,000
When a corporation reacquires its own shares with stated value, it records the cash paid at fair market value and debits the treasury stock account for the same amount. Treasury stock is a contra-equity account that reduces the total shareholders' equity. Treasury stock can be reissued or retired by the corporation.
For example, suppose LMN Corporation reacquires 1,000 shares of its common stock with a stated value of $5 per share for $20 per share. The journal entry to record this transaction is:
Dr. Treasury Stock 20,000 Cr. Cash 20,000
When a corporation retires its own shares with stated value, it cancels the shares and reduces the share capital and additional paid-in capital accounts by the amounts that were originally recorded when the shares were issued. Any difference between the cash paid and the total reduction in equity is recorded as a gain or loss on retirement.
For example, suppose LMN Corporation retires the 1,000 shares of its common stock with a stated value of $5 per share that it reacquired for $20 per share. The original issue price of these shares was $25 per share. The journal entry to record this transaction is:
Dr. Common Stock 5,000 Dr. Additional Paid-in Capital 20,000 Dr. Retained Earnings 5,000 Cr. Treasury Stock 30,000
Chapter 6 Answer Key
If you want to check your understanding of Chapter 6 and practice your skills in accounting for share capital transactions, you can access the answer key online. The answer key provides detailed solutions to all the exercises and problems in Chapter 6 of Win Ballada's book.
To access the answer key online, you need to follow these steps:
Go to https://www.studocu.com/ph/document/tomas-del-rosario-college/auditing/lec-chapter-6-ballada-partnership-and-corporation/14936421, which is one of the web search results for "partnership and corporation accounting 2012 by win ballada chapter 6 answer key free download.zip".
Click on "Download" button on the top right corner of the page.
Sign up for a free account or log in with your existing account.
Choose your preferred payment method and confirm your subscription.
Download the answer key as a PDF file.
If you want to download the answer key as a zip file, you need to follow these steps:
Go to https://trello.com/c/pdYhBXzm/602-verified-partnership-and-corporation-accounting-2012-by-win-ballada-chapter-6-answer-key-free-downloadzip, which is another web search result for "partnership and corporation accounting 2012 by win ballada chapter 6 answer key free download.zip".
Click on "Download" button on the bottom right corner of the page.
Enter your email address and click on "Send".
Check your email inbox and click on the link to download the zip file.
Extract the zip file and open the PDF file.
To unzip the file and view the answers, you need to follow these steps:
Right-click on the zip file and choose "Extract All".
Select a destination folder and click on "Extract".
Open the destination folder and double-click on the PDF file.
View the answers using a PDF reader.
Conclusion
In this article, we have explained what partnership and corporation accounting is, who Win Ballada is and what his book covers, and how to access the answer key for Chapter 6 online. We have also provided you with a detailed overview of Chapter 6, which deals with accounting for share capital. We have discussed the types of shares, their characteristics, and how to record their issuance, reacquisition, and retirement.
By using the answer key, you can benefit from the following:
You can test your knowledge and understanding of the concepts and principles of partnership and corporation accounting.
You can practice your skills and techniques in accounting for share capital transactions.
You can compare your answers with the correct solutions and identify your strengths and weaknesses.
You can improve your performance and confidence in solving accounting problems.
If you are interested in learning more about partnership and corporation accounting, we recommend you to read Win Ballada's book and use his answer key as a guide. You can also visit https://corporatefinanceinstitute.com/resources/accounting/share-capital/ for more resources on share capital and other accounting topics.
We hope you have enjoyed this article and found it useful. If you have any questions or feedback, please feel free to contact us. Thank you for reading!
FAQs
What is the difference between par value, no-par value, and stated value shares?
Par value shares are shares that have a nominal or face value assigned by the corporation when they are authorized. No-par value shares are shares that do not have a specified par value assigned by the corporation. Stated value shares are shares that do not have a specified par value assigned by the corporation but have a minimum value that is determined by the board of directors.
How do par value, no-par value, and stated value shares affect the accounting for share capital?
Par value shares affect the accounting for share capital by creating an additional paid-in capital account that represents the excess amount that the shareholders paid over the par value. No-par value shares affect the accounting for share capital by eliminating the additional paid-in capital account. Stated value shares affect the accounting for share capital by creating an additional paid-in capital account that represents the excess amount that the shareholders paid over the stated value.
What is treasury stock and how is it accounted for?
Treasury stock is a contra-equity account that represents the shares of stock that a corporation has reacquired from its shareholders. Treasury stock is accounted for by debiting the treasury stock account for the cash paid to reacquire the shares and crediting it for the cash received to reissue or retire the shares.
What is a gain or loss on retirement of shares and how is it calculated?
A gain or loss on retirement of shares is an income statement item that represents the difference between the cash paid to retire the shares and the total reduction in equity resulting from canceling the shares. A gain or loss on retirement of shares is calculated by subtracting the total reduction in equity from the cash paid to retire the shares.
Where can I find more information on partnership and corporation accounting?
You can find more information on partnership and corporation accounting by reading Win Ballada's book and using his answer key as a guide. You can also visit https://corporatefinanceinstitute.com/resources/accounting/share-capital/ for more resources on share capital and other accounting topics.
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