Question

I was wondering if you could post solutions for problem E5-3. I don't have one question in particular but I would like to fact check my answers. What is preferred stock labeled as? Which one current asset, investments, PP&E, intangible assets, other assets, current liabilities, long term liabilities, capital stock, equity noncontrolling interest, paid in capital in excess of par, retained earnings? Bold one is the one I think.

Also would about fully depreciated still in use?

And then is this not shown?- 16. salaries that company budget shows will be paid to employees within the next year

The question is already posted on here I found. chapter 5 3e. but questions remain the same.

Book: Intermediate Accounting, Wiley 16 edition

Answer 1

1. Actually equity non controlling interest is the minority interest i.e. equity shares of the company hold by minorities. So, preferred stock cannot be labelled as equity min controlling interest. Please note that preferred stock is a type of capital stock issued by a corporation. It forms part of capital of the corporation. Hence, it can be labelled as capital stock. Capital stock can be common stock or preferred stock .

2 . Fully depriciated asset is to be shown at it's cost less accumulated depriciation on it. As long as we are using an asset it will form part of balance sheet. However, no further depriciation will be charged on it.

3. About salary to employee, please explain it more clearly.