There are currently 400,000 no par value common shares of GK Ltd. reflected in the share capital account at a total value of $8,000,000. A further 200,000 common shares are issued at $23 per share. Subsequently, GK Ltd. purchased for retirement 100,000 common shares at $22 per share. The effect of the common share retirement is: A. $2,000,000 reduction of share capital. B. $200,000 charge to retained earnings.

There are currently 400,000 no par value common shares of GK Ltd. reflected in the share capital account at a total value of $8,000,000. A further 200,000 common shares are issued at $23 per share. Subsequently, GK Ltd. purchased for retirement 100,000 common shares at $22 per share. The effect of the common share retirement is: A. $2,000,000 reduction of share capital. B. $200,000 charge to retained earnings.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 5P: Alert Companys shareholders equity prior to any of the following events is as follows: The company...

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