In the Chart Below,assign the Directional Effect (I = Increase,D

question 18

Essay

In the chart below,assign the directional effect (I = increase,D = decrease,or NE = no effect)of each of the following four transactions on the components of the book value of common shareholders' equity.
a.Recognition of compensation expense related to restricted stock.
b.Granting of stock appreciation rights to be settled with cash.
c.Recognition of compensation expense on stock appreciation rights.
d.Reacquisition and retirement of common stock at an amount greater than original issue price.
$$\begin{array} { | c | c | c | c | c | c | c | } \hline \text { Item } & \begin{array} { c } \text { Common } \\\text { Stock }\end{array} & \begin{array} { c } \text { Additional } \\\text { Paid-In } \\\text { Capital }\end{array} & \begin{array} { c } \text { Deferred } \\\text { Compensation }\end{array} & \begin{array} { c } \text { Retained } \\\text { Earnings }\end{array} & \begin{array} { c } \text { Treasury } \\\text { Stock at } \\\text { Cost }\end{array} & \begin{array} { c } \text { Total Common } \\\text { Shareholders' } \\\text { Equity }\end{array} \\\hline \text { a. } & & & & & & \\\hline \text { b. } & & & & & & \\\hline \text { c. } & & & & & & \\\hline \text { d. } & & & & & & \\\hline\end{array}$$

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Definitions:

Market Value

The current value of an asset or company based on the price that it can be sold in the open market.

Paid In Surplus

The amount of money paid by investors for shares above their nominal value, representing additional contributed capital.

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to boost the stock's liquidity, though the market capitalization remains the same.

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer.