Recall 3 year-old Manny, at the beginning of the chapter, who has & a seizure disorder. He receives his care in a mobile van sent to his community by the….
What is the effect on earnings per share when a company purchases treasury stock
The stockholders equity section of Nielsen Corporation s December 31, 2002, balance sheet is as follows:
|Preferred stock (10%, $50 par, 10,000 shares authorized,|
|1,000 shares issued and outstanding)||$ 50,000|
|Common stock ($15 par, 100,000 shares authorized,|
|5,000 shares issued and outstanding)||75,000|
|Paid-in capital in excess of par, preferred stock .||2,000|
|Paid-in capital in excess of par, common stock .||25,000|
|Total contributed capital.||$152,000|
|Total stockholders equity||$254,000|
During 2003, Nielsen Corporation had the following transactions affecting stockholders equity:
Jan. 20 Paid a cash dividend of $2 per share on common stock. The dividend was declared on December 15, 2002.
Aug. 15 Reacquired 1,000 shares of common stock at $20 per share.
Sept. 30 Reissued 500 shares of treasury stock at $21 per share.
Oct. 15 Declared and paid cash dividends of $3 per share on the common stock.
Nov. 1 Reissued 200 shares of treasury stock at $18 per share.
Dec. 15 Declared and paid the 10% preferred cash dividend.
Dec. 31 Closed net income of $40,000 to Retained Earnings. (Revenues were $260,000; expenses were $220,000.) Also closed the dividends accounts to Retained Earnings.
1. Journalize the transactions.
2. Prepare the stockholders equity section of Nielsen Corporation s December 31, 2003, balance sheet.
3. Interpretive Question: What is the effect on earnings per share when a company purchases treasury stock