Mod 3

• Treasury share are also known as re-acquired shares
• TS refers to previously issued outstandinv shares that has been re purchased and is being held by the issuing company in its treasury
• Ts is a contra equity account that reduces its shareholder's equity by the amount paid for the stock
• Total number of outstanding shares in the open market decreased by buying back its own stock
• Kapag treasury shares while in the hands of the corporatiom cannot vote
• Ts are not included in the
• ESOs is a company offered plan that gives the employees the right to buy shares of the company at pre-determined price
• ESO is an option given to employee to purchase common stocks of the company at a fixed price within a specified period of time
• To buy out or acquire ownership takeover
• EPS indicates how much money a company makes for each share of stock
• EPS = NI / OS
• Price-Earning Ratio is the ratio for valuing a vompany that measures its current share price relative to its eps
• P/E also known as earning multiple
• EPS before minus EPS after = n divide orig eps
• Ts may affect the cash flow but they have no effect on the profit of the
• Cost method treasury shares are recordee at cost regardless of whrther the shares are acquire velow or abpve par or stated value. If purchased in cash the cost is equal to cash payments
• PAR VALUE METHOD shares are debited for the amount equal to the par or stated value
• Retired shares are treasury shares that are permanently cancelled and cannot be reissued on the market later thus ut is considered to have no financoal value
• RS are no longer listed as treasury sharrs on the companys financial statemnet
• Share based payment is a transaction in which the entity receives goods or services either as consideration for its equity intruments or by incurring liabilities for amounts based on the price of the entity's shares or equity
• EI is a legally applicable evidence of ownership right in a firm, like share certificate
• Fair value of the share less exercise price is intrinsic value
• Equity settled - receives gpods and services as consideration for its own equity instruments. Based on fair market value
• Cash settled SBP, goods or services are paid for at amount that are based on the price of the company's equity instrument
• EQUITY SETTLED WITH CASH ALTERNATIVE has a choice to settled in cash or equity instruments
• Fair value


  The amount for which an asset can be exchanged, liability settled, or an equity instrument granted could be exchanged between knowledgeable willing parties at an arm's length transaction
• Organization expense


  An expense account used for services in connection with incorporation
• Share/stock option


  A right to buy a particular amount of ordinary shares at a fixed price at a future date over a certain period of time
• Exercise price


  Price which an underlying asset can be purchased or sold when trading a call or put option
• Call price


  Price at which the issuer of a share can redeem a callable preferred share or a bond. Also known as redemption price
• Grant date


  The date at which the entity and another party (including employees) agree to a share-based payment arrangement
• Vesting conditions


  Conditions or restrictions that determine whether the entity receives the services that entitle the counterparty to receive cash or equity instruments of the entity under a share-based payment arrangement
• Vesting period


  The period which all the specified vesting conditions of a share-based arrangement are to be satisfied
• Vest


  Become an entitlement. The vesting date is when the cash and equity instruments granted vest
• Share based payment to NON EMPLOYEEs , with perofrmance condition, measurement is based at the lowest aggregate fair value
• Shares issued to employee are usually subjwcted to a vesting period before theh can sold
• Donated Capital


  Assets, shares, contributions given to corporation as gift
• Recorded at fair market value DC
• DC will appear as share premium
• Callable preference shares refer to a varietyof shares that may have been redeemed by the issuer at a set value before maturity date