Question 1

YTC sold and issued 200 of its common shares, true no-par, at $12 per share.Assuming no specific legal requirements, the common share account should be credited for:

Accepted Answer

A) $2,000 
B) $240 
C) $2,400 
D) $200 
A) $2,000 
B) $240 
C) $2,400 
D) $200

Question 2

Accounting recognition must be given to common share subscriptions on the subscription date:

Accepted Answer

A) because all events relating to the common share accounts must be disclosed. 
B) because a legal contract is involved. 
C) because the dollar amount is usually large. 
D) to guarantee the receipt of dividends subsequent to the subscription date. 
A) because all events relating to the common share accounts must be disclosed. 
B) because a legal contract is involved. 
C) because the dollar amount is usually large. 
D) to guarantee the receipt of dividends subsequent to the subscription date.

Question 3

Ownership of shares usually entitles the holders to all of the following rights except:

Accepted Answer

A) To elect the board of directors of the corporation. 
B) To share in the profits of the corporation. 
C) To control the day-to-day operations of the corporation. 
D) To purchase new shares when they are offered for sale. 
A) To elect the board of directors of the corporation. 
B) To share in the profits of the corporation. 
C) To control the day-to-day operations of the corporation. 
D) To purchase new shares when they are offered for sale.

Question 4

Dividends may not be paid from share capital without creditor approval.

Accepted Answer

A) True 
 B)False

Question 5

As of January 1, 2013 there are 2 years of dividends in arrears on an issue of cumulative nonconvertible preferred shares.No dividends on preferred shares were declared in 2013.Therefore, under IFRS, on the Dec.31, 2013 financial statements, the firm issuing the preferred shares:

Accepted Answer

A) Subtracts 2 years of dividends on preferred shares from earnings when computing earnings per share for 2013 
B) Discloses in a footnote to 2013's balance sheet that there are 3 years of dividends on preferred shares in arrears 
C) Discloses in a footnote to 2013's balance sheet that there are 2 years of dividends on preferred shares in arrears 
D) Reports a liability equal to 3 years of dividends on preferred shares 
E) Reports a liability equal to 2 years of dividends on preferred shares 
A) Subtracts 2 years of dividends on preferred shares from earnings when computing earnings per share for 2013 
B) Discloses in a footnote to 2013's balance sheet that there are 3 years of dividends on preferred shares in arrears 
C) Discloses in a footnote to 2013's balance sheet that there are 2 years of dividends on preferred shares in arrears 
D) Reports a liability equal to 3 years of dividends on preferred shares 
E) Reports a liability equal to 2 years of dividends on preferred shares

Question 6

On December 31, 2013, TTX reported owners' equity of $150,000.During 2014, TTX declared and paid cash dividends of $30,000; reported a net loss of $15,000; issued additional common shares (no par)for $70,000; and purchased treasury stock at a cost of $15,000 (cash), Therefore, the 2014 ending amount of shareholders' equity was:

Accepted Answer

A) $230,000 
B) $215,000 
C) $160,000 
D) $170,000 
A) $230,000 
B) $215,000 
C) $160,000 
D) $170,000

Question 7

Which of the following is NOT a true statement? Treasury stock is:

Accepted Answer

A) Shares that have been issued but are no longer outstanding. 
B) Shares that are included in earnings per share calculations. 
C) Shares that cannot receive dividends nor vote. 
D) Recorded in an equity account that has a debit balance. 
E) Shares that are held by the issuing company but has not been retired. 
A) Shares that have been issued but are no longer outstanding. 
B) Shares that are included in earnings per share calculations. 
C) Shares that cannot receive dividends nor vote. 
D) Recorded in an equity account that has a debit balance. 
E) Shares that are held by the issuing company but has not been retired.

Question 8

RST had the following shareholders and the shares owned by each on November 15:   On that date, RST declared a 1 for 2 common stock dividend.The stock was selling for $10 per share.RST issued fractional share rights when necessary.RST had to issue which of the following number of fractional share rights:

Accepted Answer

A) Three. 
B) More than three. 
C) One. 
D) Two. 
A) Three. 
B) More than three. 
C) One. 
D) Two.

Question 9

Shareholders in a corporation usually have limited liability.

Accepted Answer

A) True 
 B)False

Question 10

DWWR purchased its own common shares for $20,000 and debited the treasury stock account for the purchase price.The shares were subsequently sold for $17,000.The $3,000 difference between the cost and sale price should be recorded as a reduction of:

Accepted Answer

A) The beginning balance of retained earnings. 
B) Revenues on the income statement. 
C) Contributed capital from treasury stock transactions without regard as to whether or not there have been previous net "gains" from sales or retirements of the same class of shares. 
D) Contributed capital from treasury stock transactions to the extent of previous net "gains" from sales or retirements of the same class of shares; otherwise retained earnings should be reduced. 
A) The beginning balance of retained earnings. 
B) Revenues on the income statement. 
C) Contributed capital from treasury stock transactions without regard as to whether or not there have been previous net "gains" from sales or retirements of the same class of shares. 
D) Contributed capital from treasury stock transactions to the extent of previous net "gains" from sales or retirements of the same class of shares; otherwise retained earnings should be reduced.

Question 11

Brimley Corp.issued 5,000 common shares, no par, and 800 preferred shares.At the time of issue the common shares were selling at $30 per.There is no current market value for the preferred shares.Total cash received was $162,000.Prepare the journal entry to record the issuance of the shares.

Accepted Answer

Since market values for prefer

Question 12

When a corporation declares a small stock dividend, it should capitalize the par value of the shares.

Accepted Answer

A) True 
 B)False

Question 13

Propertee, Inc.declared a dividend on May 1 payable in shares of Milly, Inc.(original cost: $4 per share, acquired at the beginning of the current year)to Propertee shareholders of record on June 1.The payment date is July 1.The dividend requires 20,000 shares of Milly to be distributed.Market prices of Milly/share were: May 1: $6; June 1: $8; July 1: $9.Provide the entry at declaration of the dividend.

Accepted Answer

Please see

Question 14

On 2 January 20X4, GHI Corporation was incorporated in the province of Ontario.It was authorized to issue an unlimited number of no-par value common shares, and 10,000 shares of no-par, $8, cumulative and non-participating preferred.During 20X4, the firm completed the following transactions:   Part A: Prepare Journal entries to record the subscription of common shares
Part B: Prepare Journal entries to record the issuance of preferred shares in exchange for assets; recorded at fair market value of the assets in the absence of a value for the preferred shares.
Part C: Prepare Journal entries to record the receipt of donated assets.
Part D: Prepare Journal entries to record the receipt of cash for subscribed shares and issuance of shares.
Part E: Prepare Journal entries to record the acquisition and retirement of common shares.Part F: Prepare Journal entries to record dividends declared.
Part G: Prepare Journal entries to record the closing of the income summary account.

Accepted Answer

Part A: @#IMG-DLM& Part B: @#IMG-DLM& Pa

Question 15

The number of treasury shares held by a corporation equals:

Accepted Answer

A) All shares held by the treasurer of the corporation. 
B) The difference between authorized shares and outstanding shares. 
C) The difference between issued shares and outstanding shares. 
D) All shares purchased by shareholders due to their pre-emptive right. 
A) All shares held by the treasurer of the corporation. 
B) The difference between authorized shares and outstanding shares. 
C) The difference between issued shares and outstanding shares. 
D) All shares purchased by shareholders due to their pre-emptive right.

Question 16

In accounting for dividends, the declaration date is the most important date because dividends are paid to whomever owns the shares on that date.

Accepted Answer

A) True 
 B)False

Question 17

Indicate the principle effects of a cash dividend (declared and paid), a stock dividend issued, and a stock split issued, on the financial statements of the issuing corporation.Respond as follows: I-for increase; D-for decrease; and N-no effect.Assume no stock

Accepted Answer

Please see

Question 18

In a stock split, only the content of contributed capital is changed, whereas in a stock dividend the amount of contributed capital is changed.

Accepted Answer

A) True 
 B)False

Question 19

If a corporation has dividends in arrears on preferred shares, they should also:

Accepted Answer

A) Declare the dividends. 
B) Record a liability for the dividends. 
C) Capitalize retained earnings for the dividends. 
D) Report the dividends in arrears. 
A) Declare the dividends. 
B) Record a liability for the dividends. 
C) Capitalize retained earnings for the dividends. 
D) Report the dividends in arrears.

Question 20

All unrealized gains and losses, regardless of origin, flow through Other Comprehensive Income.

Accepted Answer

A) True 
 B)False

YTC sold and issued 200 of its common shares, true no-par, at $12 per share.Assuming no specific legal requirements, the common share account should be credited for:

Accounting recognition must be given to common share subscriptions on the subscription date:

Ownership of shares usually entitles the holders to all of the following rights except:

Dividends may not be paid from share capital without creditor approval.

As of January 1, 2013 there are 2 years of dividends in arrears on an issue of cumulative nonconvertible preferred shares.No dividends on preferred shares were declared in 2013.Therefore, under IFRS, on the Dec.31, 2013 financial statements, the firm issuing the preferred shares:

Which of the following is NOT a true statement? Treasury stock is:

Shareholders in a corporation usually have limited liability.

DWWR purchased its own common shares for $20,000 and debited the treasury stock account for the purchase price.The shares were subsequently sold for $17,000.The $3,000 difference between the cost and sale price should be recorded as a reduction of:

Brimley Corp.issued 5,000 common shares, no par, and 800 preferred shares.At the time of issue the common shares were selling at $30 per.There is no current market value for the preferred shares.Total cash received was $162,000.Prepare the journal entry to record the issuance of the shares.

When a corporation declares a small stock dividend, it should capitalize the par value of the shares.

The number of treasury shares held by a corporation equals:

In accounting for dividends, the declaration date is the most important date because dividends are paid to whomever owns the shares on that date.

Indicate the principle effects of a cash dividend (declared and paid), a stock dividend issued, and a stock split issued, on the financial statements of the issuing corporation.Respond as follows: I-for increase; D-for decrease; and N-no effect.Assume no stock

In a stock split, only the content of contributed capital is changed, whereas in a stock dividend the amount of contributed capital is changed.

If a corporation has dividends in arrears on preferred shares, they should also:

All unrealized gains and losses, regardless of origin, flow through Other Comprehensive Income.

Financial Liabilities and Provisions

Financial Instruments: Long-Term Debt

Financial Instruments: Complex Debt and Equity

Corporate Income Tax

Tax Losses

Leases

Post-Employment Benefits

Earnings Per Share

Accounting Changes

Financial Statement Analysis

Filters

Exam 14: Shareholders Equity

YTC sold and issued 200 of its common shares, true no-par, at $12 per share.Assuming no specific legal requirements, the common share account should be credited for:

Accounting recognition must be given to common share subscriptions on the subscription date:

Ownership of shares usually entitles the holders to all of the following rights except:

Dividends may not be paid from share capital without creditor approval.

As of January 1, 2013 there are 2 years of dividends in arrears on an issue of cumulative nonconvertible preferred shares.No dividends on preferred shares were declared in 2013.Therefore, under IFRS, on the Dec.31, 2013 financial statements, the firm issuing the preferred shares:

Which of the following is NOT a true statement? Treasury stock is:

Shareholders in a corporation usually have limited liability.

DWWR purchased its own common shares for $20,000 and debited the treasury stock account for the purchase price.The shares were subsequently sold for $17,000.The $3,000 difference between the cost and sale price should be recorded as a reduction of:

Brimley Corp.issued 5,000 common shares, no par, and 800 preferred shares.At the time of issue the common shares were selling at $30 per.There is no current market value for the preferred shares.Total cash received was $162,000.Prepare the journal entry to record the issuance of the shares.

When a corporation declares a small stock dividend, it should capitalize the par value of the shares.

The number of treasury shares held by a corporation equals:

In accounting for dividends, the declaration date is the most important date because dividends are paid to whomever owns the shares on that date.

Indicate the principle effects of a cash dividend (declared and paid), a stock dividend issued, and a stock split issued, on the financial statements of the issuing corporation.Respond as follows: I-for increase; D-for decrease; and N-no effect.Assume no stock

In a stock split, only the content of contributed capital is changed, whereas in a stock dividend the amount of contributed capital is changed.

If a corporation has dividends in arrears on preferred shares, they should also:

All unrealized gains and losses, regardless of origin, flow through Other Comprehensive Income.

Financial Liabilities and Provisions

Financial Instruments: Long-Term Debt

Financial Instruments: Complex Debt and Equity

Corporate Income Tax

Tax Losses

Leases

Post-Employment Benefits

Earnings Per Share

Accounting Changes

Financial Statement Analysis

Filters