Question 1

The total of the owners' claims to the assets of a corporation is represented by the:

Accepted Answer

A) balance of the Common Stock account. 
B) total retained earnings. 
C) total stockholders' equity. 
D) total assets of the corporation. 
A) balance of the Common Stock account. 
B) total retained earnings. 
C) total stockholders' equity. 
D) total assets of the corporation.

Question 2

The cost of treasury stock is deducted from the ------------section of the balance sheet.

Accepted Answer

Stockholde

Question 3

A corporation reacquired 450 shares of its $100 par-value common stock for $112 a share. The entry to record this transaction includes a

Accepted Answer

A) debit to Treasury Stock-Common for $50,400. 
B) debit to Treasury Stock-Common for $45,000. 
C) credit to Paid-in Capital for Treasury Stock Transactions-Common for $45,000. 
D) credit to Treasury Stock-Common for $50,400. 
A) debit to Treasury Stock-Common for $50,400. 
B) debit to Treasury Stock-Common for $45,000. 
C) credit to Paid-in Capital for Treasury Stock Transactions-Common for $45,000. 
D) credit to Treasury Stock-Common for $50,400.

Question 4

Accumulated profits that are kept in the business, as opposed to being distributed as dividends to stockholders, are called---------- .

Accepted Answer

The answer of Accumulated profits that are kept in the...

Question 5

A corporation may use--------- to lower market share prices in an effort to attract new investors.

Accepted Answer

The answer of A corporation may use--------- to lower market...

Question 6

The adjustment for the amount of future taxes to be paid as a result of the MACRS depreciation deduction taken in this and prior years is recorded with:

Accepted Answer

A) a debit to Tax Expense and a credit to Deferred Income Tax Asset. 
B) a debit to Deferred Income Tax Liability and a credit to Tax Expense. 
C) a debit to Tax Expense and a credit to Deferred Income Tax Liability. 
D) a debit to Deferred Income Tax Asset and a credit to Tax Expense. 
A) a debit to Tax Expense and a credit to Deferred Income Tax Asset. 
B) a debit to Deferred Income Tax Liability and a credit to Tax Expense. 
C) a debit to Tax Expense and a credit to Deferred Income Tax Liability. 
D) a debit to Deferred Income Tax Asset and a credit to Tax Expense.

Question 7

The Matt Tress Sofa Company has 11,000 shares of $2 par common stock outstanding. On August 22, 2019, a 3% stock dividend was declared to be distributed on September 30, 2019. The market value of the stock on August 22 was $21; the market value on September 30 was $18. What is the amount to be credited to the Common Stock account on September 30?

Accepted Answer

A) $660. 
B) $990. 
C) $5,940. 
D) $6,930. 
A) $660. 
B) $990. 
C) $5,940. 
D) $6,930.

Question 8

Information from the Income Statement columns of King 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 $5,000 through quarterly deposits. What adjustment is recorded for
Income Tax Expense? 4. What is the amount of net income after income tax?

Accepted Answer

1. $2,650 Net Loss; 2. $-0-; 3. Debit In

Question 9

The Denver Corporation is authorized to issue 3,000 shares of 8 percent, $50 par-value preferred stock and 10,000 shares of no-par-value common stock with a stated value of $20 per share. On December 31, 2019, 1,000 shares of preferred stock and 4,000 shares of common stock are issued and outstanding. The corporation's transactions affecting stockholders' equity during 2020 are given below. Record the transactions on page 8 of a general journal. Omit descriptions.
Jan. 15 Repurchased 200 shares of outstanding preferred stock for $44,600 in cash. The stock is to be held as treasury stock.
Mar. 1 Declared a 2-for-1 stock split of common stock. Each shareholder is to receive one new share for each share held. The stated value of the stock is reduced to $10 per share. Date of record is March 15. Date of issue is April 1.
Apr. 1 Issued the new shares declared on March 1.
July 15 Declared a cash dividend of 8 percent on preferred stock and $0.35 per share on common stock to be paid on August 1 to holders of record on July 31.
Aug. 1 Paid the cash dividend declared on July 15.
Oct. 5 Accepted title to a tract of land with a fair market value of $23,000 from the city of Fairview. The land is to be used as a building site for a new warehouse.
Nov. 8 The board of directors passed a resolution to appropriate $40,000 for the construction of a new warehouse.
Dec.15 Declared a stock dividend payable January 15, 2021, to common stockholders of record on December 28, 2020, at the rate of one new share of common stock for each ten shares held. The estimated market value of the common stock is $11 per share.

Accepted Answer

@#IMG-DLM&

Preferred dividend = 800 sh

Question 10

The Dividends Payable account appears on the balance sheet as a(n)------- .

Accepted Answer

The answer of The Dividends Payable account appears on the...

Question 11

The Santa Fe Corporation is authorized to issue 6,000 shares of 4 percent, $100 par-value preferred stock and 20,000 shares of no-par-value common stock with a stated value of $40 per share. On December 31, 2019, 2,000 shares of preferred stock and 8,000 shares of common stock are issued and outstanding. The corporation's transactions affecting stockholders' equity during 2020 are given below. Record the transactions on page 15 of a general journal. Omit descriptions.
Jan. 15 Repurchased 400 shares of outstanding preferred stock for $89,200 in cash. The stock is to be held as treasury stock.
Mar. 1 Declared a 2-for-1 stock split of common stock. Each shareholder is to receive one new share for each share held. The stated value of the stock is reduced to $20 per share. Date of record is March 15. Date of issue is April 1.
Apr. 1 Issued the new shares declared on March 1.
July 15 Declared a cash dividend of 4 percent on preferred stock and $0.70 per share on common stock to be paid on August 1 to holders of record on July 31.
Aug. 1 Paid the cash dividend declared on July 15.
Oct. 5 Accepted title to a tract of land with a fair market value of $46,000 from the city of Evergreen Park. The land is to be used as a building site for a new factory.
Nov. 8 The board of directors passed a resolution to appropriate $80,000 for the construction of a new warehouse.
Dec.15 Declared a stock dividend payable January 15, 2021, to common stockholders of record on December 28, 2020, at the rate of one new share of common stock for each ten shares held. The estimated market value of the common stock is $22 per share.

Accepted Answer

@#IMG-DLM&

Preferred dividend = 1,600

Question 12

Which of the following would not change the amount of total retained earnings for the year?

Accepted Answer

A) the transfer of retained earnings appropriated for treasury stock 
B) the net income after taxes for the year 
C) stock dividends declared and distributed 
D) cash dividends declared and distributable 
A) the transfer of retained earnings appropriated for treasury stock 
B) the net income after taxes for the year 
C) stock dividends declared and distributed 
D) cash dividends declared and distributable

Question 13

A corporation reported net income of $200,000 for its fiscal year and declared and paid cash dividends of $80,000. A stock dividend recorded at $40,000 was also distributed during the year. If the beginning balance of the Retained Earnings account was $60,000, calculate the ending balance in the Retained Earnings account.

Accepted Answer

The answer of A corporation reported net income of $200,000...

Question 14

When a corporation reacquires stock that it previously issued and intends to reissue at a later date, the------------ account is debited.

Accepted Answer

The answer of When a corporation reacquires stock that it...

Question 15

Retained Earnings represents the net income earned throughout the years less amounts paid out as dividends.

Accepted Answer

A) True 
 B)False

Question 16

For the current year, Genexo Corporation reported net income before income taxes of $235,000. 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.)

Accepted Answer

The answer of For the current year, Genexo Corporation reported...

Question 17

Aspen Corporation reported net income of $120,000 for its fiscal year and declared and paid cash dividends of $60,000 during the year. In November, the 10,000 shares of $10 par, common stock split, 2 for 1. If the ending balance of the Retained Earnings prior to the split was $200,000, the beginning balance was:

Accepted Answer

A) $120,000. 
B) $140,000. 
C) $150,000. 
D) $160,000. 
A) $120,000. 
B) $140,000. 
C) $150,000. 
D) $160,000.

Question 18

A(n)---------dividend will decrease Retained Earnings but will not decrease total stockholders' equity.

Accepted Answer

The answer of A(n)---------dividend will decrease Retained Earnings but will...

Exam 21: Corporate Earnings and Capital Transactions

The total of the owners' claims to the assets of a corporation is represented by the:

The cost of treasury stock is deducted from the ------------section of the balance sheet.

A corporation reacquired 450 shares of its $100 par-value common stock for $112 a share. The entry to record this transaction includes a

Accumulated profits that are kept in the business, as opposed to being distributed as dividends to stockholders, are called---------- .

A corporation may use--------- to lower market share prices in an effort to attract new investors.

The adjustment for the amount of future taxes to be paid as a result of the MACRS depreciation deduction taken in this and prior years is recorded with:

The Dividends Payable account appears on the balance sheet as a(n)------- .

Which of the following would not change the amount of total retained earnings for the year?

When a corporation reacquires stock that it previously issued and intends to reissue at a later date, the------------ account is debited.

Retained Earnings represents the net income earned throughout the years less amounts paid out as dividends.

For the current year, Genexo Corporation reported net income before income taxes of $235,000. 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.)

A(n)---------dividend will decrease Retained Earnings but will not decrease total stockholders' equity.

Accounting: The Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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