Question 1

A stock split has no effect on retained earnings.

Accepted Answer

A) True 
 B)False

Question 2

When the corporation has both preferred and common stock,the steps to compute book value for common stock would be:

Accepted Answer

A) compute common shares divided by number of shares outstanding. 
B) compute preferred stock book value first;the remainder is assigned to common stock. 
C) divide total stockholders' equity by total shares outstanding. 
D) None of these answers is correct. 
A) compute common shares divided by number of shares outstanding. 
B) compute preferred stock book value first;the remainder is assigned to common stock. 
C) divide total stockholders' equity by total shares outstanding. 
D) None of these answers is correct.

Question 3

Market value per share is the price per share a corporation pays to holders of stock when it is redeemed.

Accepted Answer

A) True 
 B)False

Question 4

The credit purchase of treasury stock was recorded as a purchase.This error would cause:

Accepted Answer

A) the period end assets to be overstated. 
B) the period end liabilities to be overstated. 
C) the period end stockholders' equity to be overstated. 
D) the period end liabilities to be understated. 
A) the period end assets to be overstated. 
B) the period end liabilities to be overstated. 
C) the period end stockholders' equity to be overstated. 
D) the period end liabilities to be understated.

Question 5

Sold treasury stock at a price below cost when there was not enough paid-in capital from treasury stock to absorb the difference between cost and selling price.
Debit ________ & ________ & ________ Credit ________

Accepted Answer

Debit 1 &

Question 6

Which of the following is considered a contra-stockholders' equity account?

Accepted Answer

A) Common Stock 
B) Accumulated Depreciation 
C) Treasury Stock 
D) Preferred Stock 
A) Common Stock 
B) Accumulated Depreciation 
C) Treasury Stock 
D) Preferred Stock

Question 7

Gino's Corporation had 30,000 shares of $16 par value common stock outstanding with a market value of $30 per share.Gino announced a four-for-one stock split.After the split,the par value of the stock:

Accepted Answer

A) remained the same as before the split. 
B) was reduced to $4.00 per share. 
C) was reduced by $4.00 per share. 
D) was reduced to $8.00 per share. 
A) remained the same as before the split. 
B) was reduced to $4.00 per share. 
C) was reduced by $4.00 per share. 
D) was reduced to $8.00 per share.

Question 8

The payment of wages was debited to Retained Earnings.This error would cause:

Accepted Answer

A) the period end assets to be understated. 
B) the period end liabilities to be understated. 
C) the period end stockholders' equity to be understated. 
D) the period's net income to be overstated. 
A) the period end assets to be understated. 
B) the period end liabilities to be understated. 
C) the period end stockholders' equity to be understated. 
D) the period's net income to be overstated.

Question 9

The declaration of a stock dividend was credited to Dividends Payable and debited to Retained Earnings.This error would cause:

Accepted Answer

A) the period end assets to be overstated. 
B) the period end liabilities to be overstated. 
C) the period end stockholders' equity to be overstated. 
D) the period's net income to be overstated. 
A) the period end assets to be overstated. 
B) the period end liabilities to be overstated. 
C) the period end stockholders' equity to be overstated. 
D) the period's net income to be overstated.

Question 10

Sold treasury stock at a price below cost when there was no paid-in capital from treasury stock to absorb the difference between cost and selling price.
Debit ________ & ________ Credit ________

Accepted Answer

Debit 1 &

Question 11

What is the book value per share of common stock if total stockholders' equity is $800,000 with 20,000 shares of common stock outstanding? (Assume no preferred stock is outstanding)

Accepted Answer

A) $40.00 
B) $4.00 
C) $400.00 
D) $20.00 
A) $40.00 
B) $4.00 
C) $400.00 
D) $20.00

Question 12

Explain some possible reasons a company may declare a stock dividend instead of a cash dividend.

Accepted Answer

A cash dividend is the distribution of e

Question 13

An appropriation to retained earnings reduces total shareholders' equity.

Accepted Answer

A) True 
 B)False

Question 14

To record the purchase of treasury stock:

Accepted Answer

A) debit Treasury Stock-Common (par value);credit Cash (same). 
B) debit Treasury Stock-Common (purchase price);credit Cash (same). 
C) debit Treasury Stock-Common (par value);debit any difference to Paid-in Capital;credit Cash (purchase price). 
D) None of these answers is correct. 
A) debit Treasury Stock-Common (par value);credit Cash (same). 
B) debit Treasury Stock-Common (purchase price);credit Cash (same). 
C) debit Treasury Stock-Common (par value);debit any difference to Paid-in Capital;credit Cash (purchase price). 
D) None of these answers is correct.

Question 15

Declared a stock dividend when the market price was above par.
Debit ________ Credit ________ & ________

Accepted Answer

Debit 9,Cr

Question 16

On May 31,Mason Corporation has the following stockholders' equity:
 $\begin{array}{l}
\text { Common Stock, } \$ 12 \text { par value, } 8,000 \text { shares }\
\begin{array}{lr}
\text { issued and outstanding } & \$ 96,000 \
\text { Retained Earnings } & 20,000 \
\text { Total Stockholders' Equity } & \$ 116,000
\end{array}
\end{array}$ 
The board of directors declared a 10% stock dividend on June 5 to the stockholders of record on June 15.The stock is to be distributed on June 30.On the date of declaration,the stock had a market value of $15 per share.Prepare the appropriate journal entries for these transactions.

Accepted Answer

The answer of On May 31,Mason Corporation has the following...

Question 17

Which of the following is the journal entry to record the declaration of a stock dividend?

Accepted Answer

A) Debit Common Stock Dividend Distributable (number of shares × par value common stock);credit Common Stock (same) 
B) Debit Common Stock Dividend Distributable (number of shares × market value common stock);credit Common Stock (same) 
C) Debit Retained Earnings (market value × number of shares);credit Common Stock Dividend Distributable (number of shares × par value);credit Paid-In Capital in Excess of Par Value Stock Dividend (market value - par value)× number of shares 
D) Debit Common Stock (number of shares × par value);credit Cash 
A) Debit Common Stock Dividend Distributable (number of shares × par value common stock);credit Common Stock (same) 
B) Debit Common Stock Dividend Distributable (number of shares × market value common stock);credit Common Stock (same) 
C) Debit Retained Earnings (market value × number of shares);credit Common Stock Dividend Distributable (number of shares × par value);credit Paid-In Capital in Excess of Par Value Stock Dividend (market value - par value)× number of shares 
D) Debit Common Stock (number of shares × par value);credit Cash

Question 18

Retained Earnings is reported as part of shareholders' equity on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 19

The date of record for cash dividends is:

Accepted Answer

A) the date the board of directors pays a dividend. 
B) the date established by the board of directors that determines who will receive dividends. 
C) the date that creates a liability for the company. 
D) None of these answers is correct. 
A) the date the board of directors pays a dividend. 
B) the date established by the board of directors that determines who will receive dividends. 
C) the date that creates a liability for the company. 
D) None of these answers is correct.

Question 20

Book value per share is found by dividing total assets by total stockholders' equity.

Accepted Answer

A) True 
 B)False

Exam 19: Corporations: Stock Values,dividends,treasury Stocks,

A stock split has no effect on retained earnings.

When the corporation has both preferred and common stock,the steps to compute book value for common stock would be:

Market value per share is the price per share a corporation pays to holders of stock when it is redeemed.

The credit purchase of treasury stock was recorded as a purchase.This error would cause:

Sold treasury stock at a price below cost when there was not enough paid-in capital from treasury stock to absorb the difference between cost and selling price. Debit ________ & ________ & ________ Credit ________

Which of the following is considered a contra-stockholders' equity account?

Gino's Corporation had 30,000 shares of $16 par value common stock outstanding with a market value of $30 per share.Gino announced a four-for-one stock split.After the split,the par value of the stock:

The payment of wages was debited to Retained Earnings.This error would cause:

The declaration of a stock dividend was credited to Dividends Payable and debited to Retained Earnings.This error would cause:

Sold treasury stock at a price below cost when there was no paid-in capital from treasury stock to absorb the difference between cost and selling price. Debit ________ & ________ Credit ________

What is the book value per share of common stock if total stockholders' equity is $800,000 with 20,000 shares of common stock outstanding? (Assume no preferred stock is outstanding)

Explain some possible reasons a company may declare a stock dividend instead of a cash dividend.

An appropriation to retained earnings reduces total shareholders' equity.

To record the purchase of treasury stock:

Declared a stock dividend when the market price was above par. Debit ________ Credit ________ & ________

Which of the following is the journal entry to record the declaration of a stock dividend?

Retained Earnings is reported as part of shareholders' equity on the balance sheet.

The date of record for cash dividends is:

Book value per share is found by dividing total assets by total stockholders' equity.

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property,plant,equipment,and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

Sold treasury stock at a price below cost when there was not enough paid-in capital from treasury stock to absorb the difference between cost and selling price. Debit & & Credit

Sold treasury stock at a price below cost when there was no paid-in capital from treasury stock to absorb the difference between cost and selling price. Debit & Credit

Declared a stock dividend when the market price was above par. Debit Credit &