On June 8, Steering Ltd was incorporated and issued 56,000
common shares for $280,000. On August...
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Accounting
On June 8, Steering Ltd was incorporated and issued 56,000common shares for $280,000. On August 19, an additional 14,000shares were issued for $84,000. On November 2, the company paid$29,760 to reacquire 6,200 common shares and on December 7 it paid$51,350 to reacquire 7,900 common shares.
Calculate the average cost of the common shares on June 8,August 19, November 2, and December 7.
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ans 1
june 8 th
Number of
stock
value
issue
56000
280,000
therefore
average price = 280000/56000
5.00
ans
2
19-Aug
Number of
stock
value
issue
56000
280,000
additional
14000
84000
70000.0
364000.0
Average
price =
=364000/70000
5.20
ans
3
2-Nov
Number of
stock
value
issue
56000
280,000
additional
14000
84000
70000.0
364000.0
5.20
Note :
reacquired stock will not impact equity it will be treated as
treasury stock
ans
4
7-Dec
Number of
stock
value
issue
56000
280,000
additional
14000
84000
70000.0
364000.0
5.20
Note :
reacquired stock will not impact equity it will be treated as
treasury stock
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