Understand and be able to describe each of the following equity accounts that are commonly reported on a company's balance sheet: a. Common Stock b. Additional Paid-in Capital c. Preferred stock d. Retained Earnings e. Treasury Stock f. Accumulated other comprehensive income 2. Understand how/why each type of equity account changes during a period. a. Account rollforwards (Note: "Rollforward" means going from the beginning balance to the ending balance and understanding what changes the account balance in between. For example, if we "rolled forward" retained earnings, we'd say the retained earnings starts with $100,000, increases by $250,000 for net income, decreases by $200,000 for dividends, and therefore ends at a $150,000 balance. So I want you to understand the typical transactions that change each equity account.) 3. Common Stock a. How is the balance in the common stock account calculated (assuming common stock has a par value)? b. What is par value? c. How do you account for costs incurred to issue shares of common stock?

Answer rating: 100% (QA)

1 Equity Accounts on a Balance Sheet a Common Stock Common stock represents the ownership interest in a company It is typically issued to shareholders ... View the full answer