W16-3 SB Company has outstanding 40,000 shares of P5 par common stock which had been issued at P30 per share. SB then entered into the following transactions. 1. Purchased 5,000 treasury shares at $45 per share. 2. Resold 500 of the treasury shares at $40 per share. 3. Resold 2,000 of the treasury shares at $49 per share. Instructions: Use the following code to indicate the effect each of the three transactions has on the financial statement categories listed in the table below; assuming SB Company uses the cost method. |= Increase; D = Decrease; NE = No effect. Retained Net Earning Number Assets Liabilities Stockholders' Paid-in Equity Capital Income 2 3

W16-3 SB Company has outstanding 40,000 shares of P5 par common stock which had been issued at P30 per share. SB then entered into the following transactions. 1. Purchased 5,000 treasury shares at $45 per share. 2. Resold 500 of the treasury shares at $40 per share. 3. Resold 2,000 of the treasury shares at $49 per share. Instructions: Use the following code to indicate the effect each of the three transactions has on the financial statement categories listed in the table below; assuming SB Company uses the cost method. |= Increase; D = Decrease; NE = No effect. Retained Net Earning Number Assets Liabilities Stockholders' Paid-in Equity Capital Income 2 3

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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