Question 1

Stocks that pay large dividends on a regular basis are growth stocks.

Accepted Answer

A) True 
 B)False

Question 2

A corporation issued 300 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 $1,500 debit to Organization Expenses. 
C) A $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. 
A) A $1,800 credit to Common Stock. 
B) A $1,500 debit to Organization Expenses. 
C) A $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.

Question 3

The cumulative net income and loss retained by a corporation is called ____________.

Accepted Answer

The answer of The cumulative net income and loss retained...

Question 4

A company's only treasury stock transactions for the current year follow:
 (1)1,000 shares of its common stock were purchased on June 1 for $40,000; (2)On July 1 it reissued 500 of these shares at $45 per share; (3)On August 1 it reissued the 500 remaining treasury shares at $38 per share.
1)Prepare the journal entries required to record these transactions.
2)Calculate the balance in Paid-in Capital,Treasury Stock,on September 1 assuming its beginning-year balance is zero.

Accepted Answer

@#IMG-DLM& 2) There is a credi

Question 5

A corporation declared and issued a 15% stock dividend on November 1.The following information was available immediately prior to the dividend:
  The amount that contributed capital will increase (decrease)as a result of recording this stock dividend is:

Accepted Answer

A) $45,000. 
B) $135,000. 
C) $(45,000). 
D) $(135,000). 
E) $0. 
A) $45,000. 
B) $135,000. 
C) $(45,000). 
D) $(135,000). 
E) $0.

Question 6

Changes in accounting estimates are:

Accepted Answer

A) Considered accounting errors. 
B) Reported as prior period adjustments. 
C) Accounted for with a cumulative "catch-up" adjustment. 
D) Extraordinary items. 
E) Accounted for in current and future periods. 
A) Considered accounting errors. 
B) Reported as prior period adjustments. 
C) Accounted for with a cumulative "catch-up" adjustment. 
D) Extraordinary items. 
E) Accounted for in current and future periods.

Question 7

The total amount of cash and other assets the corporation receives from its stockholders in exchange for common stock is called __________________________.

Accepted Answer

The answer of The total amount of cash and other...

Question 8

In many states,the minimum amount that stockholders must contribute to the corporation,and which is intended to protect the creditors of the corporation,is called the:

Accepted Answer

A) Par value of preferred. 
B) Minimum legal capital. 
C) Premium capital. 
D) Stated value. 
E) Working capital. 
A) Par value of preferred. 
B) Minimum legal capital. 
C) Premium capital. 
D) Stated value. 
E) Working capital.

Question 9

A corporation issued 5,000 shares of $10 par value common stock in exchange for some land with a market value of $60,000.The entry to record this exchange is:

Accepted Answer

A) Debit Land $60,000; credit Common Stock $50,000; credit Paid-In Capital in Excess of Par Value, Common Stock $10,000. 
B) Debit Land $60,000; credit Common Stock $60,000. 
C) Debit Land $50,000; credit Common Stock $50,000. 
D) Debit Common Stock $50,000; debit Paid-In Capital in Excess of Par Value, Common Stock $10,000; credit Land $60,000. 
E) Debit Common Stock $60,000; credit Land $60,000. 
A) Debit Land $60,000; credit Common Stock $50,000; credit Paid-In Capital in Excess of Par Value, Common Stock $10,000. 
B) Debit Land $60,000; credit Common Stock $60,000. 
C) Debit Land $50,000; credit Common Stock $50,000. 
D) Debit Common Stock $50,000; debit Paid-In Capital in Excess of Par Value, Common Stock $10,000; credit Land $60,000. 
E) Debit Common Stock $60,000; credit Land $60,000.

Question 10

A company reported net income of $478,000 and paid $5,500 in preferred cash dividends during the current year.The company had 100,000 common shares issued,and 10,000 common shares in treasury during the year.The year-end market price per common share was $43.05.Calculate the company's price-earnings ratio.

Accepted Answer

Price-Earnings Ratio = Market

Question 11

Prior period adjustments are reported in the:

Accepted Answer

A) Multiple-step income statement. 
B) Balance sheet. 
C) Statement of retained earnings. 
D) Statement of cash flows. 
E) Single-step income statement. 
A) Multiple-step income statement. 
B) Balance sheet. 
C) Statement of retained earnings. 
D) Statement of cash flows. 
E) Single-step income statement.

Question 12

For each of the following independent transactions a through d,prepare the necessary journal entry:
(a)Declared a $0.40 per share cash dividend on 200,000 shares of preferred stock outstanding.
(b)Declared and distributed a 12% stock dividend on 800,000 shares of $5 par value common stock outstanding.Market price per common share on this date was $25.
(c)Declared and distributed a 2-for-1 stock split on 500,000 shares of $10 par value common stock outstanding.
(d)Declared and distributed a 30% stock dividend on 400,000 common shares of $5 par value common stock outstanding.Market price per common share on this date was $20.

Accepted Answer

The answer of For each of the following independent transactions...

Question 13

A company is authorized to issue 50,000 shares of $50 par,10%,noncumulative,nonparticipating preferred stock and 500,000 shares of no-par common stock.Prepare journal entries to record the following selected transactions that occurred during this year:

Accepted Answer

The answer of A company is authorized to issue 50,000...

Question 14

On September 1,a corporation had 50,000 shares of $5 par value common stock,and $1,000,000 of retained earnings.On that date,when the market price of the stock is $15 per share,the corporation issues a 2-for-1 stock split.The general journal entry to record this transaction is:

Accepted Answer

A) Debit Retained Earnings $750,000; credit Common Stock Split Distributable $750,000. 
B) Debit Retained Earnings $750,000; credit Common Stock $750,000. 
C) Debit Retained Earnings $250,000; credit Common Stock $250,000. 
D) Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. 
E) No entry is made for this transaction. 
A) Debit Retained Earnings $750,000; credit Common Stock Split Distributable $750,000. 
B) Debit Retained Earnings $750,000; credit Common Stock $750,000. 
C) Debit Retained Earnings $250,000; credit Common Stock $250,000. 
D) Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. 
E) No entry is made for this transaction.

Question 15

Stated value of no-par stock is:

Accepted Answer

A) Another name for redemption value. 
B) An amount assigned to par value stock by the state of incorporation. 
C) The market value of the stock on the date of issuance. 
D) The difference between the par value of stock and the amount below or above par value paid-in by the stockholder. 
E) An amount assigned to no-par stock by the corporation's board of directors. 
A) Another name for redemption value. 
B) An amount assigned to par value stock by the state of incorporation. 
C) The market value of the stock on the date of issuance. 
D) The difference between the par value of stock and the amount below or above par value paid-in by the stockholder. 
E) An amount assigned to no-par stock by the corporation's board of directors.

Question 16

A company declared a $0.50 per share cash dividend.The company has 20,000 shares authorized,9,000 shares issued,and 8,000 shares of common stock outstanding.The journal entry to record the dividend declaration is:

Accepted Answer

A) Debit Retained Earnings $4,000; credit Common Dividends Payable $4,000. 
B) Debit Common Dividends Payable $4,000; credit Cash $4,000. 
C) Debit Retained Earnings $4,500; credit Common Dividends Payable $4,500. 
D) Debit Common Dividends Payable $4,500; credit Cash $4,500. 
E) Debit Retained Earnings $10,000; credit Common Dividends Payable $10,000. 
A) Debit Retained Earnings $4,000; credit Common Dividends Payable $4,000. 
B) Debit Common Dividends Payable $4,000; credit Cash $4,000. 
C) Debit Retained Earnings $4,500; credit Common Dividends Payable $4,500. 
D) Debit Common Dividends Payable $4,500; credit Cash $4,500. 
E) Debit Retained Earnings $10,000; credit Common Dividends Payable $10,000.

Question 17

___________________________ are corrections of material errors in prior period financial statements.

Accepted Answer

Prior peri

Question 18

Marble Corporation had the following balances in its stockholders' equity accounts at December 31,2013:
   The following transactions occurred during 2014:
   Based on the above information,prepare a statement of stockholders' equity for 2014.Use the form below.

Accepted Answer

@#IMG-DLM& *(20,000 - 1,000 +

Question 19

Prior period adjustments to financial statements can result from:

Accepted Answer

A) Changes in accounting estimates. 
B) Unacceptable accounting practices. 
C) Discontinued operations. 
D) Changes in tax law. 
E) Extraordinary items. 
A) Changes in accounting estimates. 
B) Unacceptable accounting practices. 
C) Discontinued operations. 
D) Changes in tax law. 
E) Extraordinary items.

Question 20

A company made an error in calculating and reporting depreciation expense in 2013.The error was discovered in 2014.The item should be reported as a prior period adjustment:

Accepted Answer

A) on the 2013 statement of retained earnings. 
B) on the 2013 income statement. 
C) on the 2014 statement of retained earnings. 
D) on the 2014 income statement. 
E) accounted for with a cumulative "catch-up" adjustment. 
A) on the 2013 statement of retained earnings. 
B) on the 2013 income statement. 
C) on the 2014 statement of retained earnings. 
D) on the 2014 income statement. 
E) accounted for with a cumulative "catch-up" adjustment.

Exam 13: Accounting for Corporations

Stocks that pay large dividends on a regular basis are growth stocks.

A corporation issued 300 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:

The cumulative net income and loss retained by a corporation is called ____________.

A corporation declared and issued a 15% stock dividend on November 1.The following information was available immediately prior to the dividend: The amount that contributed capital will increase (decrease)as a result of recording this stock dividend is:

Changes in accounting estimates are:

The total amount of cash and other assets the corporation receives from its stockholders in exchange for common stock is called __________________________.

In many states,the minimum amount that stockholders must contribute to the corporation,and which is intended to protect the creditors of the corporation,is called the:

A corporation issued 5,000 shares of $10 par value common stock in exchange for some land with a market value of $60,000.The entry to record this exchange is:

Prior period adjustments are reported in the:

A company is authorized to issue 50,000 shares of $50 par,10%,noncumulative,nonparticipating preferred stock and 500,000 shares of no-par common stock.Prepare journal entries to record the following selected transactions that occurred during this year:

On September 1,a corporation had 50,000 shares of $5 par value common stock,and $1,000,000 of retained earnings.On that date,when the market price of the stock is $15 per share,the corporation issues a 2-for-1 stock split.The general journal entry to record this transaction is:

Stated value of no-par stock is:

A company declared a $0.50 per share cash dividend.The company has 20,000 shares authorized,9,000 shares issued,and 8,000 shares of common stock outstanding.The journal entry to record the dividend declaration is:

___________________________ are corrections of material errors in prior period financial statements.

Marble Corporation had the following balances in its stockholders' equity accounts at December 31,2013: The following transactions occurred during 2014: Based on the above information,prepare a statement of stockholders' equity for 2014.Use the form below.

Prior period adjustments to financial statements can result from:

A company made an error in calculating and reporting depreciation expense in 2013.The error was discovered in 2014.The item should be reported as a prior period adjustment:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Time Value of Money B

Activity-Based Costing C

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