Exam 21: Corporate Earnings and Capital Transactions

For the current year, Folk Enterprises, Inc. reported net income before income taxes of $300,000. Using the following corporate income tax rates, compute the corporation's federal income taxes payable. (Assume that the firm's taxable income is the same as its income for financial accounting purposes.)

The Treasury Stock account is shown on the balance sheet as:

Treasury stock is:

If the corporation's income tax computed at the end of the year is less than the total of quarterly deposits, the necessary adjustment will result in a:

If a corporation receives a gift of land valued at $10,000 from a city, the journal entry will include a debit to Land and a credit to -----------.

Which of the following statements is not correct?

For the current year, Tyler Corporation reported net income before income taxes of $42,000. Using the following corporate income tax rates, compute the corporation's federal income taxes payable. (Assume that the firm's taxable income is the same as its income for financial accounting purposes.)

The following information was taken from the accounting records of the Gemini Corporation on December 31, 2019. Using this information, prepare the Stockholders' Equity section of the corporation's balance sheet. Preferred Stock: 10%, $100 par value; 5,000 shares authorized; 1,200 shares issued and outstanding Paid-in Capital in Excess of Par Value-Preferred Stock, $4,000 Common Stock: $50 par value; 10,000 shares authorized; 4,500 shares issued and outstanding; Paid-in Capital in Excess of Par Value-Common Stock, $5,000 Retained Earnings: Total, $105,000; appropriated for warehouse construction, $40,000

A corporation paid estimated income taxes of $62,800 during 2019. At the end of the year, the corporation's tax bill is computed to be $58,000. Record the entry to adjust the Income Tax Expense account on page 6 of a general journal. Omit the description.

Information from the Income Statement columns of Leland Corporation's worksheet on December 31, 2019, is shown below. 1. What is the amount of net income before income tax? 2. What is the amount of income tax on the net income? Use the tax rates set forth below. 3. The corporation paid $8,400 through quarterly deposits. What adjustment is recorded for Income Tax Expense? 4. What is the amount of net income after income tax?

Which of the following statements is not correct?

Total stockholders' equity would be decreased by

Which of the following statements is correct?

A corporation paid estimated income taxes of $52,100 during 2019. At the end of the year, the corporation's tax bill is computed to be $57,500. Record the entry to adjust the Income Tax Expense account on page 6 of a general journal. Omit the description.

The worksheet for a corporation and a sole proprietorship are almost identical. The major difference is the:

An appropriation of retained earnings reduces the amount of retained earnings available for dividend declarations.

Treasury Stock can be purchased for all of the following reasons except:

On the worksheet for the current year ended Dec 31, column totals in the Income Statement section are debit, $220,000 and credit $285,000. Assume that the income and deductions for tax purposes are the same as those for financial reporting and that the company paid estimated taxes of $15,000 to date. Tax rates remain 15% for the first $50,000; 25% on the next 25,000; 34% on the next $25,000 and 39% on the excess over $100,000. Prepare the adjusting entry for income taxes.

A corporation paid estimated income taxes of $91,600 during 2019. At the end of the year, the corporation's tax bill is computed to be $87,500. Record the entry to adjust the Income Tax Expense account on page 6 of a general journal. Omit the description.

The Topeka Corporation has 40,000 shares of $3 par value common stock outstanding. On July 1, the corporation declared a stock dividend payable July 31, 2019, to common stockholders of record on July 20, 2019, at the rate of one new share of common stock for each ten shares held. The estimated market value of the common stock is $36 per share. Record the transactions on page 15 of a general journal. Omit descriptions.