Vous êtes sur la page 1sur 26

1-1

8-1

CHAPTER 8

Accounting for and Presentation


of Owners¶ Equity

m 
   m   
    
1-2
8-2

Nature of Owners¶ Equity


ë 
     

  
 
 

 @  



      
   


   
   
 


  



   

m 
   m   
    
1-3
8-3

ë 
Owners¶ Equity Section
*' (+)$
O  

     
      
     
     
   
          
! "  # $  %   & %&
   ' ()$ 

m 
   m   
    
1-4
8-4

ë 
Paid-in Capital
Common Stock
On January 01, 2008, Matrix, Inc. issued 100,000 of its $3 par value
common stock for $14 per share. The following entry is recorded:
!"#$
%&#"$
D        D   


   
  
      

This transaction has the following effect on the financial statements of Matrix:
( 
# ) 
# 

 



`    
 
     




 
#$

 !"" """
%"" """


`&& 

'&



 "" """

m 
   m   
    
1-5
8-5

ë 
Common Stock
       
  # !    
  "    
 "
Un

t t n n
A tho z      
   !
Sh     "

m 
   m   
    
1-6
8-6

ë 
Preferred Stock
Normally no voting Has a par or stated
rights, but dividend value with dividend
payment has expressed as a
preference over percent of par.
common stock.

If   ,
,
may be retired.
 ,, may be
If  
exchanged for
common shares.
m 
   m   
    
1-7
8-7

ë 
Preferred Stock
Normally, preferred stock is cumulative meaning that all
dividends must be paid before any dividends can be
paid to common shareholders.

Preferred may be noncumulative


noncumulative.. If dividends are not
paid, the company is not required to make-
make-up the
missed dividends.

Matrix, Inc. has 50,000, $100 par value, 6%, cumulative preferred
stock outstanding. Calculate the annual dividend on the stock.

50,000 · $100 = $5,000,000 total par · 6% = $300,000 dividend

m 
   m   
    
1-8
8-8

ë  Preferred Stock Versus Bonds


   O    
  O  
 
O  
  O  
          
    
          
    
               
     
  
           
       
    
O      
   
  
            
       

m 
   m   
    
1-9
8-9

ë   
Additional Paid-in Capital
Represents the excess of the amount
received from the sale of preferred or
common stock over par (or stated) value

m 
   m   
    
1-10
8-10

ë   
Retained Earnings
Represents the cumulative earnings of a
corporation less the cumulative dividends paid
since the business started operations.

@etained earnings
is NOT cash.

m 
   m   
    
1-11
8-11

ë 
Cash Dividends

Dividends must be The company must have


declared by the board sufficient cash and
of directors before retained earnings
they can be legally paid. to pay the dividend.

The company is not


legally required to
pay dividends, but
once declared a
legal liability
is created
m 
   m   
    
1-12
8-12

ë 
Cash Dividend
 $ %& '(()&  *   +    ,-&
"     #   ./     
%((&(((         " 
#   !          
0 ! %&   !   , %"

Date of declaration ² Jan. 5


.    ` 
+ /  ` 
   `     
-  
 
           (    
) *
+ ,       
    "  !
  
      !

$ 
%& ' 
% 

 



`    
 
     

 

 


  "

 !
# !

m 
   m   
    
1-13
8-13

ë 
Cash Dividend
 $ %& '(()&  *   +    ,-&
"     #   ./     
%((&(((         " 
#   !          
0 ! %&   !   , %"

Date of record ² Feb. 5

m 
   m   
    
1-14
8-14

ë 
Cash Dividend
 $ %&  *   +    ,-& "
    #   ./      %((&(((
        "  #  
!           0 ! %&  
!   , %"

Date of payment ² Mar. 5


  ` 
`
   `     
  
 
             

0     
      !
 &  !

$ 
%& ' 
% 

 



`    
 
     

 


 &


# !
# !

m 
   m   
    
1-15
8-15

ë 
Stock Dividends
Distribution of additional shares of stock to
stockholders.

No change in par value Stockholders retain percentage


of stock or in total ownership in the company
stockholders¶ equity. (preemptive right)

Reasons for stock dividends:


Î Preserve cash.
Î Decrease market price of stock.
Î Reduce retained earnings.

m 
   m   
    
1-16
8-16

ë 
Stock Dividend

Small Stock Dividend Large Stock Dividend


Stock dividend less than Stock dividend more than
25% of outstanding 25% or the outstanding
shares. shares.

Record at current Record at par or stated


market value of stock. value of stock.

m 
   m   
    
1-17
8-17

ë 
Stock Dividend
On May 10, 2008, Matrix, Inc. declares and distributes a 2% stock
dividend on its 500,000 common shares outstanding. Par value is $1.00
per share and the current market value is $17 per share.

+) )$%, -./$ %,


 
 %  
 (
      )*    
   !
a 

"
  #   $
          
a     
  
%
      &  &  
   '    

a  

  
   
 
   

  
     

m 
   m   
    
1-18
8-18

ë  Stock Dividend
On May 10, 2008, Matrix, Inc. declares and distributes a 2% stock
dividend on its 500,000 common shares outstanding. Par value is $1.00
per share and the current market value is $17 per share.
`- `
  `
     
    
"
 1       12


 
 1
`
      13

$  
 
  
`     
       
 
 
#12 





1 
`



13 

m 
   m   
    
1-19
8-19

ë 
Stock Split

  
+    
!   
#    "
 "

°   
 
   
"

° 1     "

m 
   m   
    
1-20
8-20

ë 
Stock Split

Matrix, Inc. has 300,000 shares of $1 par


value common stock outstanding before a
2±for
for±
±1 stock split.

efore Split fter Split


ommon Shares 300,000 · ' 00,000
ar alue per Share $ 1.00 2 ' $ 0. 0
otal ar alue $ 300,000 $ 300,000

m 
   m   
    
1-21
8-21

ë 
Other Comprehensive Income
A new category in owners¶ equity called
accumulated other comprehensive income
(loss) includes the following unrealized
changes to owners¶ equity:
1. Cumulative foreign currency translation
adjustments,
2. nrealized gains or losses on available-
available-for
for--sale
investments, net of related income taxes,
3. Additional minimum pension liability
adjustments, net of related income taxes.
m 
   m   
    
1-22
8-22

ë 
Treasury Stock
 $ '%& '(()& ,-& "    %&(((  
            .3(    "

+) )$%,-./$ %,
D % ( )*   D ! 
"
- #  ( 
#  
 

$    '    
   
`      !    
 !
   
"#$%&%%% "#$%&%%%

Contra owners¶ equity account

m 
   m   
    
1-23
8-23

ë  Treasury Stock
 " 3(& '(()& ,-& "   '&(((  
             .3%    "

% - %
D % (   *   D 

"
% 0 1  
(

# '
%    &    

2,000 · $30 cost per share


' 
( ) 
( 

 



`    
 
     

" 


 
#

 !
$ !


`%% 

%



& !

m 
   m   
    
1-24
8-24

ë 
Proprietorships and Partnerships
Proprietorships (single owner) and partnerships (two
or more owners) do not issue stock.
Proprietorship Partnership
 
  

 
   
 
         
 
 !"#

 
!"#
   
$ %

 
Drawing accounts are $ %
   
  

distributions to owners
similar to dividends.

Net income and drawing accounts are transferred


to capital accounts at the end of the period.

m 
   m   
    
1-25
8-25

ë 
Not-for-Profit Organizations
Owners· equity in not-
not-for
for--profit and
governmental organizations are referred
to as fund balances. Individual resource
providers do not have specific claims
against an organization·s assets.

m 
   m   
    
1-26
8-26

End of Chapter 8

m 
   m