Question 1

Treasury stock is stock that has been authorized,issued,and is outstanding.

Accepted Answer

A) True 
 B)False

Question 2

The _______________________ protects stockholders' proportional interest in a corporation by allowing them to purchase their proportional share of any common stock later issued by the corporation.

Accepted Answer

The answer of The _______________________ protects stockholders' proportional interest in...

Question 3

The following data has been collected about Keller Company's stockholders' equity accounts:  Assuming the treasury shares were all purchased at the same price,the number of shares of treasury stock is:

Accepted Answer

A)  1,150.
B)  1,000.
C)  575.
D)  11,000.
E)  21,000.F) C) and D)
G) D) and E)

Question 4

When a corporation has only one class of stock,the stock is called

Accepted Answer

A)  Preferred stock.
B)  Common stock.
C)  Par value stock.
D)  Stated value stock.
E)  No-par value stock.F) C) and E)
G) A) and B)

Question 5

A corporation's distribution of additional shares of its own stock to its stockholders without the receipt of any payment in return is called a:

Accepted Answer

A)  Stock dividend.
B)  Stock subscription.
C)  Premium on stock.
D)  Discount on stock.
E)  Treasury stock.F) B) and D)
G) A) and E)

Question 6

Global Corporation had 50,000 shares of $20 par value common stock outstanding on July 1.Later that day the board of directors declared a 10% stock dividend when the market value of each share was $27.The entry to record this dividend is:

Accepted Answer

A)  Debit Retained Earnings $135,000;credit Common Stock Dividend Distributable $135,000.
B)  Debit Retained Earnings $135,000;credit Cash $135,000.
C)  Debit Retained Earnings $135,000;credit Common Stock Dividend Distributable $100,000;credit Paid-In Capital in Excess of Par Value,Common Stock $35,000.
D)  Debit Retained Earnings $100,000;credit Common Stock Dividend Distributable $100,000.
E)  No entry is made until the stock is issueD.Retained earnings: 50,000 shares * 10% × $27 = $135,000F) B) and C)
G) B) and D)

Question 7

Fetzer Company declared a $0.55 per share cash dividend.The company has 200,000 shares authorized,190,000 shares issued,and 8,000 shares in treasury stock.The journal entry to record the payment of the dividend is:

Accepted Answer

A)  Debit Retained Earnings $104,500;credit Common Dividends Payable $104,500.
B)  Debit Common Dividends Payable $104,500;credit Cash $104,500.
C)  Debit Retained Earnings $100,100;credit Common Dividends Payable $100,100.
D)  Debit Common Dividends Payable $100,100;credit Cash $100,100.
E)  Debit Retained Earnings $110,000;credit Common Dividends Payable $110,000.F) A) and C)
G) C) and D)

Question 8

Preferred stock which confers rights to prior periods' unpaid dividends even if they were not declared is called:

Accepted Answer

A)  Noncumulative preferred stock.
B)  Participating preferred stock.
C)  Callable preferred stock.
D)  Cumulative preferred stock.
E)  Convertible preferred stock.F) All of the above
G) A) and B)

Question 9

A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share.The entry to record this transaction would be:

Accepted Answer

A)  Debit Cash $27,500;credit Paid-in Capital in Excess of Par Value,Common Stock $2,500;credit Common Stock $25,000.
B)  Debit Cash $27,500;credit Common Stock $27,500.
C)  Debit Common Stock $27,500;credit Cash $27,500.
D)  Debit Treasury Stock $27,500;credit Cash $27,500.
E)  Debit Treasury Stock $2,500;debit Paid-in Capital in Excess of Par Value,Treasury Stock $25,000;credit Common Stock $27,500.F) A) and E)
G) A) and C)

Question 10

A corporation issued 100 shares of its $5 par value common stock in payment of a $1,800 charge from its accountant for assistance in filing its charter with the state.The entry to record this transaction will include:

Accepted Answer

A)  A $1,800 credit to Common Stock.
B)  A $300 debit to Organization Expenses.
C)  A $1,300 credit to Paid-in Capital in Excess of Par Value,Common Stock.
D)  A $1,800 debit to Legal Expenses.
E)  A $1,800 credit to Cash.F) B) and D)
G) A) and B)

Question 11

A corporation sold 14,000 shares of its $1 par value common stock at a cash price of $13 per share.The entry to record this transaction would include:

Accepted Answer

A)  A debit to Paid-in Capital in Excess of Par Value,Common Stock for $182,000.
B)  A debit to Cash for $14,000.
C)  A credit to Common Stock for $182,000.
D)  A credit to Common Stock for $14,000.
E)  A credit to Paid-in Capital in Excess of Par Value,Common Stock for $196,000.F) C) and E)
G) D) and E)

Question 12

Book value per share:

Accepted Answer

A)  Reflects the value per share if a company is liquidated at balance sheet amounts.
B)  Is assets divided by equity.
C)  Is assets divided by the number of common shares outstanding.
D)  Measures the worth of assets.
E)  Is equal to par value per share.F) B) and C)
G) C) and D)

Question 13

Stock that is retired is the same as authorized and unissued stock.

Accepted Answer

A) True 
 B)False

Question 14

A company issued 70 shares of $30 par value preferred stock for $4,000 cash.The journal entry to record the issuance is:

Accepted Answer

A)  Debit Cash $2,100;credit Preferred Stock $2,100.
B)  Debit Investment in Preferred Stock $2,100;credit Cash $2,100.
C)  Debit Cash $4,000;credit Preferred Stock $4,000.
D)  Debit Preferred Stock $2,100,debit Investment in Preferred Stock $1,900;credit Cash $4,000.
E)  Debit Cash $4,000;credit Paid-in Capital in Excess of Par Value,Preferred Stock $1,900,credit Preferred Stock $2,100.F) A) and B)
G) C) and D)

Question 15

A premium on common stock:

Accepted Answer

A)  Occurs when a corporation sells its stock for more than par or stated value.
B)  Is the difference between par value and issue price when the amount paid is below par.
C)  Represents profit from issuing stock.
D)  Represents capital gain on sale of stock.
E)  Is prohibited in most states.F) B) and C)
G) A) and D)

Question 16

Stated value stock is no-par stock that is assigned a value per share by the corporation's board of directors.

Accepted Answer

A) True 
 B)False

Question 17

A company paid $0.85 in cash dividends per share.Its earnings per share is $3.50,and its market price per share is $35.50.Its dividend yield equals:

Accepted Answer

A)  2.0%.
B)  2.4%.
C)  9.9%.
D)  21.4%.
E)  24.2%.F) A) and B)
G) D) and E)

Question 18

Slate Corporation had the following balances in its stockholders' equity accounts at December 31,2015:  The following transactions occurred during 2016:  Based on the above information,prepare a statement of stockholders' equity for 2016.Use the form below.

Accepted Answer

<img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> *(20,000 - 1,000 + ...

Question 19

When preferred stock is cumulative and the directors either do not declare a dividend to preferred stockholders or declare one that does not cover the total amount of cumulative dividends,the unpaid amount is called ____________________________.

Accepted Answer

The answer of When preferred stock is cumulative and the...

Question 20

Dynasty Corporation had stockholders' equity on January 1 as follows: Common Stock,$5 par value,1,000,000 shares authorized,400,000 shares issued;Paid-in Capital in Excess of Par Value,Common Stock,$800,000;Retained Earnings,$3,600,000.Prepare journal entries to record the following transactions:

Accepted Answer

The answer of Dynasty Corporation had stockholders' equity on January...

Exam 13: Accounting for Corporations

A company paid $0.85 in cash dividends per share.Its earnings per share is $3.50,and its market price per share is $35.50.Its dividend yield equals:

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Slate Corporation had the following balances in its stockholders' equity accounts at December 31,2015: The following transactions occurred during 2016: Based on the above information,prepare a statement of stockholders' equity for 2016.Use the form below.

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Book value per share:

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Global Corporation had 50,000 shares of $20 par value common stock outstanding on July 1.Later that day the board of directors declared a 10% stock dividend when the market value of each share was $27.The entry to record this dividend is:

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A company issued 70 shares of $30 par value preferred stock for $4,000 cash.The journal entry to record the issuance is:

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A corporation issued 100 shares of its $5 par value common stock in payment of a $1,800 charge from its accountant for assistance in filing its charter with the state.The entry to record this transaction will include:

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A premium on common stock:

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A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share.The entry to record this transaction would be:

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Fetzer Company declared a $0.55 per share cash dividend.The company has 200,000 shares authorized,190,000 shares issued,and 8,000 shares in treasury stock.The journal entry to record the payment of the dividend is:

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The _______________________ protects stockholders' proportional interest in a corporation by allowing them to purchase their proportional share of any common stock later issued by the corporation.

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Preferred stock which confers rights to prior periods' unpaid dividends even if they were not declared is called:

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A corporation's distribution of additional shares of its own stock to its stockholders without the receipt of any payment in return is called a:

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The following data has been collected about Keller Company's stockholders' equity accounts: Assuming the treasury shares were all purchased at the same price,the number of shares of treasury stock is:

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Dynasty Corporation had stockholders' equity on January 1 as follows: Common Stock,$5 par value,1,000,000 shares authorized,400,000 shares issued;Paid-in Capital in Excess of Par Value,Common Stock,$800,000;Retained Earnings,$3,600,000.Prepare journal entries to record the following transactions:

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A corporation sold 14,000 shares of its $1 par value common stock at a cash price of $13 per share.The entry to record this transaction would include:

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Stock that is retired is the same as authorized and unissued stock.

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Stated value stock is no-par stock that is assigned a value per share by the corporation's board of directors.

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Treasury stock is stock that has been authorized,issued,and is outstanding.

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When preferred stock is cumulative and the directors either do not declare a dividend to preferred stockholders or declare one that does not cover the total amount of cumulative dividends,the unpaid amount is called ____________________________.

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When a corporation has only one class of stock,the stock is called

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