What is the balance sheet impact of Crocs’ repurchase of its own shares of stock? Original blog posting (February 3, 2014)

Crocs is buying back $200 million of its own common stock In Dec 2013, Crocs announced Blackstone Group was buying $200 million of its preferred stock Crocs plans to use the funds to repurchase its own common shares in 1st quarter of 2014

Question 1 How many common stock shares will Crocs be able to repurchase in the first quarter of 2014 with the $200 million invested by Blackstone Group?

Question 2 For the sake of this exercise, assume that all of the shares are repurchased on February 1, 2014. Write the journal entry to recognize this repurchase.

Question 3 What is the impact of this common stock repurchase on Crocs’ assets, liabilities, and stockholders’ equity?

Question Recap How many common stock shares will Crocs be able to repurchase in the first quarter of 2014 with the $200 million invested by Blackstone Group? For the sake of this exercise, assume that all of the shares are repurchased on February 1, 2014. Write the journal entry to recognize this repurchase. What is the impact of this common stock repurchase on Crocs’ assets, liabilities, and stockholders’ equity?

For additional news stories to use in the accounting classroom, see the Accounting in the Headlines blog at http://accountingintheheadlines.com/ Related video resources can be found at http://www.youtube.com/user/accountingheadlines Questions or comments? Contact Dr. Wendy Tietz at wtietz@kent.edu