Kannadasexchat - Liquidating dividend accounting entry

Accounting Terms & Definitions Accounting for Merchandising Activities Debits and Credits (Double Entry Accounting) Business Valuation Formulas Time Value of Money & Present/Future Values Complex Debt & Equity Instruments Common Stock & Shareholder's Equity Accounting & Finance Ratios Valuing Common Stock Corporate Income Taxes Lower of Cost or Market (LCM) & Inventory Valuation Chart of Accounts & Bookkeeping Bonds Payable & Long Term Liabilities Capital Assets GAAP, Accrual & Cash Accounting, Information Commodity, Internal Controls & Materiality Shares of any class may include the provision that they may be converted, at particular times and / or in particular quantities, into shares of another class.

liquidating dividend accounting entry-24

When the shares are resold, the treasury stock account is credited for the cost, and the difference, which is the “gain or loss”, affects various equity accounts.

The gain or loss is not reported on the income statements.

Rather, the Company A is entitled to a portion of Company B's earnings in proportion to Company A's economic ownership of Company B's stock.

Company A records its proportionate share of the subsidiary's earnings as an increase to the account on its balance sheet.

When Company A (the investor) has significant influence over Company B (the investee)—but not majority voting power—Company A accounts for its investment in Company B using the equity method of accounting.

Last modified 07-Dec-2019 16:55