Question 1

Preferred stockholders generally have the same basic rights as common stockholders EXCEPT for:

Accepted Answer

A) voting. 
B) dividends. 
C) liquidation. 
D) preemption. 
A) voting. 
B) dividends. 
C) liquidation. 
D) preemption.

Question 2

Which of the following stockholder rights is the one that allows a stockholder to participate in the management of a corporation?

Accepted Answer

A) Vote 
B) Dividends 
C) Liquidation 
D) Preemption 
A) Vote 
B) Dividends 
C) Liquidation 
D) Preemption

Question 3

Corporations declare cash dividends from Retained Earnings.

Accepted Answer

A) True 
 B)False

Question 4

If you own 500 shares (2% of a corporation's stock)and the corporation issues 15,000 new shares,how many of the new shares can you purchase under preemptive right?

Accepted Answer

A) 500 
B) 300 
C) 800 
D) 0 
A) 500 
B) 300 
C) 800 
D) 0

Question 5

Charmed,Inc.has a $2,400 credit balance in Paid-In Capital-Treasury Stock.It sells 500 shares of treasury stock,which the company reacquired at $21/share,for $18/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Accepted Answer

A) $3,900 credit 
B) $1,500 debit 
C) $900 credit 
D) $900 debit 
A) $3,900 credit 
B) $1,500 debit 
C) $900 credit 
D) $900 debit

Question 6

Elite Electrical has 350,000 shares of $3-par common stock outstanding.They have declared a 5% stock dividend.The current market price of the common stock is $7.50/share.The amount that will be debited to Retained Earnings on the date of declaration is:

Accepted Answer

A) $52,500. 
B) $131,250. 
C) $78,750. 
D) $183,750. 
A) $52,500. 
B) $131,250. 
C) $78,750. 
D) $183,750.

Question 7

Illusions Corp.issues 5,000 shares of $20 par common stock for $28 per share.The amount credited to paid-in capital in excess of par is:

Accepted Answer

A) $100,000. 
B) $40,000. 
C) $6,000. 
D) $140,000. 
A) $100,000. 
B) $40,000. 
C) $6,000. 
D) $140,000.

Question 8

Treasury stock receives neither voting rights nor dividends.

Accepted Answer

A) True 
 B)False

Question 9

A type of stock that pays dividends in arrears is:

Accepted Answer

A) cumulative common stock. 
B) cumulative preferred stock. 
C) non-cumulative common stock. 
D) non-cumulative preferred stock. 
A) cumulative common stock. 
B) cumulative preferred stock. 
C) non-cumulative common stock. 
D) non-cumulative preferred stock.

Question 10

The date of declaration creates a(n)________ for the corporation.

Accepted Answer

A) asset 
B) liability 
C) expense 
D) revenue 
A) asset 
B) liability 
C) expense 
D) revenue

Question 11

To determine dividends on par-value preferred stock,calculate the:

Accepted Answer

A) number of outstanding shares times dividend rate. 
B) dividend rate times par value. 
C) par value times number of outstanding shares times dividend rate. 
D) number of outstanding shares divided by the dividend rate. 
A) number of outstanding shares times dividend rate. 
B) dividend rate times par value. 
C) par value times number of outstanding shares times dividend rate. 
D) number of outstanding shares divided by the dividend rate.

Question 12

If you own 800 shares (3% of a corporation's stock)and the corporation issues 10,000 new shares,how many total shares will you have after exercising your preemptive right?

Accepted Answer

A) 0 
B) 300 
C) 800 
D) 1,100 
A) 0 
B) 300 
C) 800 
D) 1,100

Question 13

Stockholders' stake in stock appears in:

Accepted Answer

A) Paid-In Capital. 
B) Owner's Equity. 
C) Retained Earnings. 
D) Cash. 
A) Paid-In Capital. 
B) Owner's Equity. 
C) Retained Earnings. 
D) Cash.

Question 14

Which of the following is an advantage of a corporation?

Accepted Answer

A) Double taxation 
B) Continuous life 
C) Unlimited liability 
D) Non-transfer of ownership 
A) Double taxation 
B) Continuous life 
C) Unlimited liability 
D) Non-transfer of ownership

Question 15

Limited liability means that the stockholders of a corporation share a personal liability for all debts of the corporation.

Accepted Answer

A) True 
 B)False

Question 16

A stock split is recorded as a(n):

Accepted Answer

A) regular journal entry. 
B) memorandum entry. 
C) adjusting entry. 
D) closing entry. 
A) regular journal entry. 
B) memorandum entry. 
C) adjusting entry. 
D) closing entry.

Question 17

Based on the following information,in which year did the company have the best return on equity?

Accepted Answer

A) Year 1 
B) Year 2 
C) Year 3 
D) The company had the same return on equity all three years.No year is better than another. 
A) Year 1 
B) Year 2 
C) Year 3 
D) The company had the same return on equity all three years.No year is better than another.

Question 18

HiTech Industries has a $11,800 credit balance in Paid-In Capital-Treasury Stock.It sells 1,000 shares of treasury stock,which the company reacquired at $58/share,for $52/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Accepted Answer

A) $5,800 credit 
B) $6,000 debit 
C) $17,800 credit 
D) $11,800 credit 
A) $5,800 credit 
B) $6,000 debit 
C) $17,800 credit 
D) $11,800 credit

Question 19

Ironworks,Inc.issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current market value of $3,000.Which of the following is NOT part of the journal entry for this transaction?

Accepted Answer

A) Debiting equipment for $3,000 
B) Crediting Common Stock for $3,000 
C) Crediting paid-in capital in excess of par-common for $600 
D) Crediting Common Stock for $2,400 
A) Debiting equipment for $3,000 
B) Crediting Common Stock for $3,000 
C) Crediting paid-in capital in excess of par-common for $600 
D) Crediting Common Stock for $2,400

Question 20

On the date of declaration:

Accepted Answer

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

Preferred stockholders generally have the same basic rights as common stockholders EXCEPT for:

Which of the following stockholder rights is the one that allows a stockholder to participate in the management of a corporation?

Corporations declare cash dividends from Retained Earnings.

If you own 500 shares (2% of a corporation's stock)and the corporation issues 15,000 new shares,how many of the new shares can you purchase under preemptive right?

Charmed,Inc.has a $2,400 credit balance in Paid-In Capital-Treasury Stock.It sells 500 shares of treasury stock,which the company reacquired at $21/share,for $18/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Elite Electrical has 350,000 shares of $3-par common stock outstanding.They have declared a 5% stock dividend.The current market price of the common stock is $7.50/share.The amount that will be debited to Retained Earnings on the date of declaration is:

Illusions Corp.issues 5,000 shares of $20 par common stock for $28 per share.The amount credited to paid-in capital in excess of par is:

Treasury stock receives neither voting rights nor dividends.

A type of stock that pays dividends in arrears is:

The date of declaration creates a(n)________ for the corporation.

To determine dividends on par-value preferred stock,calculate the:

If you own 800 shares (3% of a corporation's stock)and the corporation issues 10,000 new shares,how many total shares will you have after exercising your preemptive right?

Stockholders' stake in stock appears in:

Which of the following is an advantage of a corporation?

Limited liability means that the stockholders of a corporation share a personal liability for all debts of the corporation.

A stock split is recorded as a(n):

Based on the following information,in which year did the company have the best return on equity?

HiTech Industries has a $11,800 credit balance in Paid-In Capital-Treasury Stock.It sells 1,000 shares of treasury stock,which the company reacquired at $58/share,for $52/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Ironworks,Inc.issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current market value of $3,000.Which of the following is NOT part of the journal entry for this transaction?

On the date of declaration:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

The Statement of Cash Flows

Financial Statement Analysis

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Exam 10: Corporations: Paid-In Capital and Retained Earnings

Preferred stockholders generally have the same basic rights as common stockholders EXCEPT for:

Which of the following stockholder rights is the one that allows a stockholder to participate in the management of a corporation?

Corporations declare cash dividends from Retained Earnings.

If you own 500 shares (2% of a corporation's stock)and the corporation issues 15,000 new shares,how many of the new shares can you purchase under preemptive right?

Charmed,Inc.has a $2,400 credit balance in Paid-In Capital-Treasury Stock.It sells 500 shares of treasury stock,which the company reacquired at $21/share,for $18/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Elite Electrical has 350,000 shares of $3-par common stock outstanding.They have declared a 5% stock dividend.The current market price of the common stock is $7.50/share.The amount that will be debited to Retained Earnings on the date of declaration is:

Illusions Corp.issues 5,000 shares of $20 par common stock for $28 per share.The amount credited to paid-in capital in excess of par is:

Treasury stock receives neither voting rights nor dividends.

A type of stock that pays dividends in arrears is:

The date of declaration creates a(n)________ for the corporation.

To determine dividends on par-value preferred stock,calculate the:

If you own 800 shares (3% of a corporation's stock)and the corporation issues 10,000 new shares,how many total shares will you have after exercising your preemptive right?

Stockholders' stake in stock appears in:

Which of the following is an advantage of a corporation?

Limited liability means that the stockholders of a corporation share a personal liability for all debts of the corporation.

A stock split is recorded as a(n):

Based on the following information,in which year did the company have the best return on equity?

HiTech Industries has a $11,800 credit balance in Paid-In Capital-Treasury Stock.It sells 1,000 shares of treasury stock,which the company reacquired at $58/share,for $52/share.After the transaction,what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

Ironworks,Inc.issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current market value of $3,000.Which of the following is NOT part of the journal entry for this transaction?

On the date of declaration:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

The Statement of Cash Flows

Financial Statement Analysis

Filters