How does the purchase of treasury stock from existing shareholders affect the shareholders equity section of the balance sheet?

Week 1 discussion DQ1 Income Tax Expense and Income Taxes Payable What is the difference between a company’s income tax expense as shown on the financial statement and an income tax obligation owed to the federal government? What gives rise to these discrepancies? DQ2 Recognition of Deferred Taxes What are temporary differences? What gives rise to temporary differences? Some accountants believe that deferred taxes should be recognized only for some temporary differences.The FASB requirement states that deferred taxes should be recognized for all temporary differences. Who do you agree with, and why? Week 2 discussion DQ1 Pension Accounting and Politics Please select a company that has a pension plan. Describe the reporting requirements of the pension plan of the company you select. What does the pension plan consist of? How are the disclosures made to the plan and the pension costs? DQ2 Retiree Health Benefits What are the primary differences in reporting benefits associated with a pension plan and those associated with post retirement health benefits? Week 3 discussion DQ1 Stockholders’ Equity Section Review Illustration 18-1 in the downloadable or hard copy text (Chapter 18). This is a detailed sample stockholders’ equity section of the balance sheet for Exposition Corporation. As you can see in the shareholders equity section of the balance sheet, shareholders equity is broken down into paid in capital, retained earnings of accumulated other comprehensive income, and treasury stock. Discuss the items and item descriptions that you find in this section. For example, the first item is preferred stock. What is preferred stock? What makes it different from common stock? How is the dollar amount shown for preferred stock determined? What is par value? Why is the preferred par value set at $10? DQ2 Dividend Payments Compare the payment of cash dividends, stock dividends, property dividends, and liquidating dividends. What are the similarities and differences with respect to these types of dividends? Which form of dividend would you recommend if you are the chief financial officer of the company, and why? How does the purchase of treasury stock from existing shareholders affect the shareholders equity section of the balance sheet? Why would a company purchase stock back from existing shareholders? Week 4 discussion DQ1 EPS Financial Statement Disclosures What is basic earnings per share? What is diluted earnings per share? What are the differences between the two? How are basic and diluted earnings per share reported on the income statement and footnotes to the financial statements? Please select a company that is of interest to you and navigate to its website and to its annual report. Please examine the corporations financial statement disclosures of earnings per share (income statement and footnotes). What disclosures do you see based on your examination? DQ2 Effects of Dilutive Items on EPS Please list and discuss one item that might cause a company’s basic earnings per share to become diluted. Please describe the circumstances under which this item would dilute earnings per share. Week 5 discussion DQ1 Corporate Reporting of Accounting Changes What do we mean by a change in accounting principle? Where are changes in accounting principle disclose on a company’s annual report? How is the change reflected on a company’s financial statements? The most noteworthy item on the income statement is net income. The most noteworthy item on the cash flow statement is not net cash flow. Explain this comment. Do you agree? DQ2 Change in Estimates What do we mean by a change in accounting estimates? How is a change in accounting estimate different than a change in accounting principle? Why did the accounting profession choose to handle changes in estimates using the prospective approach instead of the retrospective approach? Week 6 discussion DQ1 Cash Flow Statement Information What is the purpose of the statement of changes in cash flow? What are the three areas (activities) that make up the statement of changes in cash flow? Why is net income the most noteworthy statement on a statement of cash flow? DQ2 Cash Flows From Operating Activities The statement of changes in cash flow includes changes associated with net operating activities. Compare the indirect and direct methods of determining cash flows from operating activities. Which method do you think provides the reader with the most valuable information? Week 7 discussion DQ1 Interpretation of the Cash Flow Statement Examine the cash flow statement for Staples, Inc. shown in Real-World Case 21-6 in Chapter 21, and discuss the five questions in the case. Note the trend in cash from operations. Why is this trend occurring? DQ2 Analyzing the Cash Flow Statement Is negative cash from operating activities a negative indicator for a company? Why, or why not? What about negative cash from investing activities? What about negative cash from financing activities?