Codification: Stock and Fair Value
Chapter 16 codification assignment
1. Identify what authoritative literature addresses accounting for stock compensation plans. What are the objectives for the accounting for share based compensation?
718-10-10-1 The objective of accounting for transactions under share-based payment arrangements with employees is to recognize in the financial statements the employee services received in exchange for equity instruments issued or liabilities incurred and the related cost to the entity as those services are consumed. This Topic uses the terms compensation and payment in their broadest senses to refer to the consideration paid for employee services.
2. How many periods of EPS data must be presented?
260-10-45-7 EPS data shall be presented for all periods for which an income statement or summary of earnings is presented. If diluted EPSdata are reported for at least one period, they shall be reported for all periods presented, even if they are the same amounts as basicEPS. If basic and diluted EPS are the same amount, dual presentation can be accomplished in one line on the income statement.
3. If a company’s outstanding shares are increased through a stock split or stock dividend, how would that change the presentation of EPS data? 260-10-55-12 If the number of common shares outstanding increases as a result of a stock dividend or stock split (see Subtopic 505-20)or decreases as a result of a reverse stock split, the computations of basic and diluted EPS shall be adjusted retroactively for all periods presented to reflect that change in capital structure. If changes in common stock resulting from stock dividends, stock splits, or reversestock splits occur after the close of the period but before the financial statements are issued or are available to be issued (as discussed in Section 855-10-25), the per-share computations for those and any prior-period financial statements presented shall be based on the new number of shares. If per-share
1. Identify what authoritative literature addresses accounting for stock compensation plans. What are the objectives for the accounting for share based compensation?
718-10-10-1 The objective of accounting for transactions under share-based payment arrangements with employees is to recognize in the financial statements the employee services received in exchange for equity instruments issued or liabilities incurred and the related cost to the entity as those services are consumed. This Topic uses the terms compensation and payment in their broadest senses to refer to the consideration paid for employee services.
2. How many periods of EPS data must be presented?
260-10-45-7 EPS data shall be presented for all periods for which an income statement or summary of earnings is presented. If diluted EPSdata are reported for at least one period, they shall be reported for all periods presented, even if they are the same amounts as basicEPS. If basic and diluted EPS are the same amount, dual presentation can be accomplished in one line on the income statement.
3. If a company’s outstanding shares are increased through a stock split or stock dividend, how would that change the presentation of EPS data? 260-10-55-12 If the number of common shares outstanding increases as a result of a stock dividend or stock split (see Subtopic 505-20)or decreases as a result of a reverse stock split, the computations of basic and diluted EPS shall be adjusted retroactively for all periods presented to reflect that change in capital structure. If changes in common stock resulting from stock dividends, stock splits, or reversestock splits occur after the close of the period but before the financial statements are issued or are available to be issued (as discussed in Section 855-10-25), the per-share computations for those and any prior-period financial statements presented shall be based on the new number of shares. If per-share