Exam 12: Stockholders Equity

A corporation has 5,000 shares of 8 percent noncumulative preferred stock and 10,000 shares of common stock outstanding.Par value for each is $50.No dividends were paid last year,but this year a $46,500 dividend is paid.How much of this $46,500 goes to the holders of common stock?

A company purchases 400 shares of its $50 par value common stock at $55 per share.It then reissues 60 shares at $58 per share.The entry upon reissue of the stock would be:

The price/earnings (P/E)ratio is a common measure of management's performance.

The board of directors of Blount Corporation declared a cash dividend of $5.00 per share on 57,000 shares of common stock on April 14,2013.The dividend is to be paid on May 15,2013,to shareholders of record on May 1,2013.The effects of the entry to record the declaration of the dividend on April 14,2013,are to

The maximum number of shares of common stock that may be issued according to the corporation's charter is referred to as

Stonehurst Corporation is authorized to issue 100,000 shares of $5 stated value common stock and 2,000 shares of $100 par value,6 percent preferred stock.Prepare entries in journal form without explanations to record the following transactions:

Match each definition with the correct term below. -Issued shares

Use the following information to answer the question below. On January 1,2013,Falcon Corporation had 40,000 shares of $10 par value common stock issued and outstanding.All 40,000 shares had been issued in a prior period at $17 per share.On February 1,2013,Falcon purchased 1,000 shares of treasury stock for $19 per share and later sold the treasury shares for $26 per share on March 2,2013. The entry to record the sale of the treasury shares on March 2,2013 is:

Treasury stock is reported in the stockholders' equity section of the balance sheet.

A corporation has

Stockholders elect the officers who appoints the board of directors of a corporation.

Match each definition with the correct term below. -Liquidating dividend

Use the following information to obtain the ratios requested below.Where necessary,carry answers to one decimal place. Dividends per share: $.1.08 Market price per share: $60 Net income: $176,000 Average stockholders' equity: $1,250,000 Earnings per share: $2.50 a.Dividends yield = _____________% b.Return on equity = _____________% c.Price/earnings (P/E)ratio = __________times

Which of the following items will not be disclosed on a statement of stockholders' equity?

A cash dividend is usually paid when a company is going out of business or reducing its operations.

The company issued 7,000 shares of stock in exchange for equipment that had a fair market value of $320,000. The entry to record transaction 1 would be:

The death of a stockholder results in the dissolution of the corporation.

The liability of a stockholder is usually limited to the stockholder's investment in the corporation and the stockholder's personal assets.

The word preferred in the phrase preferred stock means that an owner of preferred stock has some advantages over a bondholder.

Issuing common and preferred stock generally has been popular among corporations.However,some companies have bought back their common stock.For what reasons would a company buy back its own shares?