Question 1

When treasury stock is reissued for more than cost, the journal entry would include a:

Accepted Answer

A)  credit to Cash 
B)  credit to Common Stock. 
C)  debit to Treasury Stock. 
D)  credit to Paid-in Capital from Treasury Stock. 
A)  credit to Cash 
B)  credit to Common Stock. 
C)  debit to Treasury Stock. 
D)  credit to Paid-in Capital from Treasury Stock.

Question 2

On May 3, Bunny Unlimited paid a $4 cash dividend per share on $5,000 shares issued and outstanding. What is the journal entry to record this transaction?

Accepted Answer

A)  A debit to Dividends Payable and a credit to Cash 
B)  A debit to Retained Earnings and a credit to Cash 
C)  A debit to Dividends Payable and a credit to Retained Earnings 
D)  A debit to Cash and a credit to Dividends Payable 
A)  A debit to Dividends Payable and a credit to Cash 
B)  A debit to Retained Earnings and a credit to Cash 
C)  A debit to Dividends Payable and a credit to Retained Earnings 
D)  A debit to Cash and a credit to Dividends Payable

Question 3

An error to an expense account in a prior period would adjust Retained Earnings in the new period.

Accepted Answer

A) True 
 B)False

Question 4

Quinn Corporation has 4,500 shares of common stock issued and outstanding. The board of directors declared a $3.25 per share cash dividend on January 25, payable on March 25, to stockholders of record on February 25. Prepare the appropriate journal entries for the declaration and payment of the dividend.

Accepted Answer

The answer of Quinn Corporation has 4,500 shares of common...

Question 5

Lamar Industries uses the legal capital approach and issues a stock dividend worth $40,000. What would be the journal entry to record this transaction?

Accepted Answer

A)  $40,000 debit to Cash and credit Common Stock 
B)  $40,000 debit to Common Stock Dividend Distributable and credit to Cash 
C)  $40,000 debit to Common Stock Dividend Distributable and credit to Common Stock 
D)  $40,000 credit to Cash and debit to Retained Earnings 
A)  $40,000 debit to Cash and credit Common Stock 
B)  $40,000 debit to Common Stock Dividend Distributable and credit to Cash 
C)  $40,000 debit to Common Stock Dividend Distributable and credit to Common Stock 
D)  $40,000 credit to Cash and debit to Retained Earnings

Question 6

Before a four-for-one stock split, the shares outstanding were 7,000 shares at $12 par. After the split, what was the par value per share and number of shares? (Round your answer to the nearest cent.)

Accepted Answer

A)  28,000 shares at $12 per share 
B)  28,000 shares at $3.00 per share 
C)  28,000 shares at $6.00 per share 
D)  7,000 shares at $48 per share 
A)  28,000 shares at $12 per share 
B)  28,000 shares at $3.00 per share 
C)  28,000 shares at $6.00 per share 
D)  7,000 shares at $48 per share

Question 7

Which of the following would be shown on the statement of retained earnings?

Accepted Answer

A)  Purchase of treasury stock 
B)  Sale of common stock 
C)  Sale of preferred stock 
D)  Declaration of a cash dividend 
A)  Purchase of treasury stock 
B)  Sale of common stock 
C)  Sale of preferred stock 
D)  Declaration of a cash dividend

Question 8

Changes in retained earnings can result from:

Accepted Answer

A)  purchasing equipment. 
B)  net income or net loss. 
C)  paying down debt. 
D)  All of these answers are correct. 
A)  purchasing equipment. 
B)  net income or net loss. 
C)  paying down debt. 
D)  All of these answers are correct.

Question 9

The retained earnings section after a two-for-one stock split will:

Accepted Answer

A)  be one-half as much after the split. 
B)  be double as much after the split. 
C)  not change after the split. 
D)  Cannot be determined from the information given. 
A)  be one-half as much after the split. 
B)  be double as much after the split. 
C)  not change after the split. 
D)  Cannot be determined from the information given.

Question 10

Book value per share is not the same as par value per share.

Accepted Answer

A) True 
 B)False

Question 11

Barkley's Resort had 2,800 shares of $21 par value common stock outstanding. On June 1, Barkley's purchased 230 shares of treasury stock for $29 per share and later reissued them for $26 per share. What amount of profit from the reissuance will be reported on the income statement?

Accepted Answer

A)  $1,150 
B)  $690 
C)  $1,840 
D)  $0 
A)  $1,150 
B)  $690 
C)  $1,840 
D)  $0

Question 12

In the closing process for corporations, net income is closed to the retained earnings account.

Accepted Answer

A) True 
 B)False

Question 13

Baxter Corporation has 1,000 shares of $5 par value common stock issued and outstanding.
Journalize the following Baxter transactions for 20XX:
Feb. 1 Purchased 200 shares of treasury stock at $6.00.
20 Declared a $2.00 per share cash dividend payable on March 15
to stockholders of record March 1.
Mar. 15 Paid the cash dividend.
May 10 Declared a 10% stock dividend. The market value of the stock is $15.00 per share.
May 30 Distributed the stock dividend.
Jun 10 Reissued the treasury stock for $9.00.

Accepted Answer

The answer of Baxter Corporation has 1,000 shares of $5...

Question 14

From the following, determine the book value per share for preferred and common stocks, assuming $2,000 of dividends are in arrears on the preferred stock.

Accepted Answer

The answer of From the following, determine the book value...

Question 15

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 16

At the end of the accounting cycle, net income will be closed into:

Accepted Answer

A)  Treasury Stock. 
B)  Paid-in Capital. 
C)  Cash. 
D)  Retained Earnings. 
A)  Treasury Stock. 
B)  Paid-in Capital. 
C)  Cash. 
D)  Retained Earnings.

Question 17

What is the entry to restrict $40,000 for plant expansion?

Accepted Answer

A)  Debit Retained Earnings; credit Cash 
B)  Debit Retained Earnings; credit Retained Earnings Appropriated for plant expansion 
C)  Debit Retained Earnings Appropriated for plant expansion; credit Retained Earnings 
D)  Debit Cash; credit Retained Earning Appropriated for plant expansion 
A)  Debit Retained Earnings; credit Cash 
B)  Debit Retained Earnings; credit Retained Earnings Appropriated for plant expansion 
C)  Debit Retained Earnings Appropriated for plant expansion; credit Retained Earnings 
D)  Debit Cash; credit Retained Earning Appropriated for plant expansion

Question 18

May Corporation had 37,000 shares of $17 par value common stock outstanding with a market value of $30 per share. Gino announced a three-for-one stock split. After the split, the par value of the stock: (Round your answer to the nearest cent.)

Accepted Answer

A)  remained the same as before the split. 
B)  was increased by $34.00 per share. 
C)  was reduced to $5.67 per share. 
D)  was reduced to $8.50 per share. 
A)  remained the same as before the split. 
B)  was increased by $34.00 per share. 
C)  was reduced to $5.67 per share. 
D)  was reduced to $8.50 per share.

Question 19

Using the following accounts:
Indicate the account(s) to be debited and credited to record the following transactions.
-Paid a cash dividend.
Debit ________ Credit ________

Accepted Answer

A) Cash 
B) Dividends payable 
C) Preferred stock 
D) Common stock 
E) Common Stock dividend distributable
F)Paid-in capital in excess of par value-common
G)Paid-in capital in excess of par value - preferred
H)Paid-in capital from treasury stock
I)Retained earnings
J)Treasury stock
K)Paid-in capital in excess of par value-Stock dividend 
A) Cash 
B) Dividends payable 
C) Preferred stock 
D) Common stock 
E) Common Stock dividend distributable
F)Paid-in capital in excess of par value-common
G)Paid-in capital in excess of par value - preferred
H)Paid-in capital from treasury stock
I)Retained earnings
J)Treasury stock
K)Paid-in capital in excess of par value-Stock dividend

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,

When treasury stock is reissued for more than cost, the journal entry would include a:

On May 3, Bunny Unlimited paid a $4 cash dividend per share on $5,000 shares issued and outstanding. What is the journal entry to record this transaction?

An error to an expense account in a prior period would adjust Retained Earnings in the new period.

Lamar Industries uses the legal capital approach and issues a stock dividend worth $40,000. What would be the journal entry to record this transaction?

Before a four-for-one stock split, the shares outstanding were 7,000 shares at $12 par. After the split, what was the par value per share and number of shares? (Round your answer to the nearest cent.)

Which of the following would be shown on the statement of retained earnings?

Changes in retained earnings can result from:

The retained earnings section after a two-for-one stock split will:

Book value per share is not the same as par value per share.

Barkley's Resort had 2,800 shares of $21 par value common stock outstanding. On June 1, Barkley's purchased 230 shares of treasury stock for $29 per share and later reissued them for $26 per share. What amount of profit from the reissuance will be reported on the income statement?

In the closing process for corporations, net income is closed to the retained earnings account.

From the following, determine the book value per share for preferred and common stocks, assuming $2,000 of dividends are in arrears on the preferred stock.

The date of record for cash dividends is:

At the end of the accounting cycle, net income will be closed into:

What is the entry to restrict $40,000 for plant expansion?

May Corporation had 37,000 shares of $17 par value common stock outstanding with a market value of $30 per share. Gino announced a three-for-one stock split. After the split, the par value of the stock: (Round your answer to the nearest cent.)

Using the following accounts: Indicate the account(s) to be debited and credited to record the following transactions. -Paid a cash dividend. Debit ________ Credit ________

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

Using the following accounts: Indicate the account(s) to be debited and credited to record the following transactions. -Paid a cash dividend. Debit Credit