Question 1

Treasury stock is a contra stockholders' equity account.

Accepted Answer

A) True 
 B)False

Question 2

Match between columns
                        Premises: Unit of ownership in a corporation.
Total amount paid-in on capital stock.
The amount that must be retained in the business for the protection of creditors.
The amount assigned to each share of stock in the corporate charter.
Shows how many dollars of net income were earned for each dollar invested by the owners.
Net income retained in the corporation.
Widely used by stockholders and potential investors in evaluating the profitability of a company.
The issuance of additional shares of stock to stockholders accompanied by a reduction in the par or stated value per share.
Corporation's own stock that has been reacquired by the corporation but not retired.
A pro Data distribution of the corporation's own stock to stockholders.
A pro data distribution of cash to stockholders.
Preferred stockholders have a right to receive current and unpaid prior-year dividends before common stockholders receive any dividends.
A debit balance in retained earnings.
A dividend declared out of paid-in capital.
Responsible to stockholders for corporate activity .
The date the board of directors formally declares the dividend and announces it to stockholders.
Enables stockholders to maintain their same percentage ownership when new shares are issued.
Creditors only have corporate assets to satisfy their claims.

Accepted Answer

The Answer of Earnings per share and Stock split and is...

Question 3

Which of the following statements is not considered a disadvantage of the corporate form of organization?

Accepted Answer

A)  Additional taxes 
B)  Government regulations 
C)  Limited liability of stockholders 
D)  Separation of ownership and management 
A)  Additional taxes 
B)  Government regulations 
C)  Limited liability of stockholders 
D)  Separation of ownership and management

Question 4

Hsu, Inc. issued 10,000 shares of stock at a stated value of $8/share. The total issue of stock sold for $15 per share. The journal entry to record this transaction would include a

Accepted Answer

A)  debit to Cash for $80,000. 
B)  credit to Common Stock for $80,000. 
C)  credit to Paid-in Capital in Excess of Par for $150,000. 
D)  credit to Common Stock for $150,000. 
A)  debit to Cash for $80,000. 
B)  credit to Common Stock for $80,000. 
C)  credit to Paid-in Capital in Excess of Par for $150,000. 
D)  credit to Common Stock for $150,000.

Question 5

The term residual claim refers to a stockholders' right to

Accepted Answer

A)  receive dividends. 
B)  share in assets upon liquidation. 
C)  acquire additional shares when offered. 
D)  exercise a proxy vote. 
A)  receive dividends. 
B)  share in assets upon liquidation. 
C)  acquire additional shares when offered. 
D)  exercise a proxy vote.

Question 6

Wave Company originally issued 30,000 shares of $5 par common stock for $210,000 on January 3, 2018. Wave purchased 1,500 shares of treasury stock for $12,000 on November 2, 2018. On December 6, 2018, 600 shares of the treasury stock are sold for $7,200.

Instructions
Prepare journal entries to record these stock transactions.

Accepted Answer

Question 7

A dividend based on paid-in capital is termed a liquidating dividend.

Accepted Answer

A) True 
 B)False

Question 8

The acquisition of treasury stock by a corporation increases total assets and total stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 9

A typical organization chart showing delegation of authority would show

Accepted Answer

A)  stockholders delegating to the board of directors. 
B)  the board of directors delegating to stockholders. 
C)  the chief executive officer delegating to the board of directors. 
D)  the controller delegating to the chief executive officer. 
A)  stockholders delegating to the board of directors. 
B)  the board of directors delegating to stockholders. 
C)  the chief executive officer delegating to the board of directors. 
D)  the controller delegating to the chief executive officer.

Question 10

On January 1, 2018, Catlin Corporation had Retained Earnings of $448,000. During the year, Catlin had the following selected transactions:
1. Declared stock dividends of $50,000.
2. Declared cash dividends of $80,000.
3. A 2 for 1 stock split involving the issuance of 200,000 shares of $5 par value common stock for 100,000 shares of $10 par value common stock.
4. Suffered a net loss of $60,000.
Instructions
Prepare a retained earnings statement for the year.

Accepted Answer

The answer of On January 1, 2018, Catlin Corporation had...

Question 11

Brown Company has 1,000 shares of 5%, $100 par cumulative preferred stock outstanding at December 31, 2018. No dividends have been paid on this stock for 2017 or 2018. Dividends in arrears at December 31, 2018 total

Accepted Answer

A)  $0. 
B)  $500. 
C)  $5,000. 
D)  $10,000. 
A)  $0. 
B)  $500. 
C)  $5,000. 
D)  $10,000.

Question 12

Start Inc. has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2018. What is the annual dividend on the preferred stock?

Accepted Answer

A)  $50 per share 
B)  $25,000 in total 
C)  $50,000 in total 
D)  $0.50 per share 
A)  $50 per share 
B)  $25,000 in total 
C)  $50,000 in total 
D)  $0.50 per share

Question 13

Which of the following show the proper effect of a stock split and a stock dividend?

Accepted Answer

The answer of Which of the following show the proper...

Question 14

Stock can be issued only in exchange for cash.

Accepted Answer

A) True 
 B)False

Question 15

Both a stock split and a stock dividend will _________________ the number of shares outstanding and have _________________ on total stockholders' equity.

Accepted Answer

The answer of Both a stock split and a stock...

Question 16

If a corporation declares a 10% stock dividend on its common stock, the account to be debited on the date of declaration is

Accepted Answer

A)  Common Stock Dividends Distributable. 
B)  Common Stock. 
C)  Paid-in Capital in Excess of Par. 
D)  Retained Earnings. 
A)  Common Stock Dividends Distributable. 
B)  Common Stock. 
C)  Paid-in Capital in Excess of Par. 
D)  Retained Earnings.

Question 17

Which of the following is not a right or preference associated with preferred stock?

Accepted Answer

A)  The right to vote 
B)  First claim to dividends 
C)  Preference to corporate assets in case of liquidation 
D)  To receive dividends in arrears before common stockholders receive dividends 
A)  The right to vote 
B)  First claim to dividends 
C)  Preference to corporate assets in case of liquidation 
D)  To receive dividends in arrears before common stockholders receive dividends

Question 18

Under IFRS, the term reserves relates to each of the following except

Accepted Answer

A)  asset revaluations. 
B)  contributed (paid-in) capital. 
C)  fair value differences. 
D)  retained earnings. 
A)  asset revaluations. 
B)  contributed (paid-in) capital. 
C)  fair value differences. 
D)  retained earnings.

Question 19

Barton Company is a publicly held corporation whose $1 par value stock is actively traded at $31 per share. The company issued 3,000 shares of stock to acquire land recently advertised at $100,000. When recording this transaction, Barton Company will

Accepted Answer

A)  debit Land for $100,000. 
B)  credit Common Stock for $93,000. 
C)  debit Land for $93,000. 
D)  credit Paid-In Capital in Excess of Par for $93,000. 
A)  debit Land for $100,000. 
B)  credit Common Stock for $93,000. 
C)  debit Land for $93,000. 
D)  credit Paid-In Capital in Excess of Par for $93,000.

Question 20

Stockholders of a corporation directly elect

Accepted Answer

A)  the president of the corporation. 
B)  the board of directors. 
C)  the treasurer of the corporation. 
D)  all of the employees of the corporation. 
A)  the president of the corporation. 
B)  the board of directors. 
C)  the treasurer of the corporation. 
D)  all of the employees of the corporation.

Treasury stock is a contra stockholders' equity account.

Which of the following statements is not considered a disadvantage of the corporate form of organization?

Hsu, Inc. issued 10,000 shares of stock at a stated value of $8/share. The total issue of stock sold for $15 per share. The journal entry to record this transaction would include a

The term residual claim refers to a stockholders' right to

A dividend based on paid-in capital is termed a liquidating dividend.

The acquisition of treasury stock by a corporation increases total assets and total stockholders' equity.

A typical organization chart showing delegation of authority would show

Brown Company has 1,000 shares of 5%, $100 par cumulative preferred stock outstanding at December 31, 2018. No dividends have been paid on this stock for 2017 or 2018. Dividends in arrears at December 31, 2018 total

Start Inc. has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2018. What is the annual dividend on the preferred stock?

Which of the following show the proper effect of a stock split and a stock dividend?

Stock can be issued only in exchange for cash.

Both a stock split and a stock dividend will _ the number of shares outstanding and have _ on total stockholders' equity.

If a corporation declares a 10% stock dividend on its common stock, the account to be debited on the date of declaration is

Which of the following is not a right or preference associated with preferred stock?

Under IFRS, the term reserves relates to each of the following except

Barton Company is a publicly held corporation whose $1 par value stock is actively traded at $31 per share. The company issued 3,000 shares of stock to acquire land recently advertised at $100,000. When recording this transaction, Barton Company will

Stockholders of a corporation directly elect

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Statement of Cash Flows

Financial Statement Analysis

Specimen Financial Statements: Apple Inc

Specimen Financial Statements: Pepsico, Inc

Specimen Financial Statements: the Coca-Cola Company

Specimen Financial Statements: Amazoncom, Inc

Specimen Financial Statements: Wal-Mart Stores, Inc

Filters

Exam 11: Corporations: Organization, Stock Transactions

Treasury stock is a contra stockholders' equity account.

Which of the following statements is not considered a disadvantage of the corporate form of organization?

Hsu, Inc. issued 10,000 shares of stock at a stated value of $8/share. The total issue of stock sold for $15 per share. The journal entry to record this transaction would include a

The term residual claim refers to a stockholders' right to

A dividend based on paid-in capital is termed a liquidating dividend.

The acquisition of treasury stock by a corporation increases total assets and total stockholders' equity.

A typical organization chart showing delegation of authority would show

Brown Company has 1,000 shares of 5%, $100 par cumulative preferred stock outstanding at December 31, 2018. No dividends have been paid on this stock for 2017 or 2018. Dividends in arrears at December 31, 2018 total

Start Inc. has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2018. What is the annual dividend on the preferred stock?

Which of the following show the proper effect of a stock split and a stock dividend?

Stock can be issued only in exchange for cash.

Both a stock split and a stock dividend will _________________ the number of shares outstanding and have _________________ on total stockholders' equity.

If a corporation declares a 10% stock dividend on its common stock, the account to be debited on the date of declaration is

Which of the following is not a right or preference associated with preferred stock?

Under IFRS, the term reserves relates to each of the following except

Barton Company is a publicly held corporation whose $1 par value stock is actively traded at $31 per share. The company issued 3,000 shares of stock to acquire land recently advertised at $100,000. When recording this transaction, Barton Company will

Stockholders of a corporation directly elect

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Statement of Cash Flows

Financial Statement Analysis

Specimen Financial Statements: Apple Inc

Specimen Financial Statements: Pepsico, Inc

Specimen Financial Statements: the Coca-Cola Company

Specimen Financial Statements: Amazoncom, Inc

Specimen Financial Statements: Wal-Mart Stores, Inc

Filters

Both a stock split and a stock dividend will _ the number of shares outstanding and have _ on total stockholders' equity.