Exam 18: Corporations: Organizations and Stock

List and discuss the following: a.Rights of common stockholders b.Rights of preferred stockholders

Retained Earnings is the account in which a corporation's net income and net losses are placed.

The sale of common stock above par was recorded by crediting Common Stock for the total amount.This error would cause:

Madison Corporation is authorized to issue 3,000 shares of common stock.Record the journal entry for each of the following independent situations.Assume Madison issues 750 shares at $15 on August 31. a)Common stock has a $10 per share par value. b)Common stock has no par value and no stated amount. c)Common stock is no-par stock with a stated value of $8 per share.

Corporations can issue:

Each share of capital stock of a corporation gives its owner the right to:

If only one type of stock is issued,it is:

The sale of common stock was recorded as a sale of preferred stock.This error would cause:

When a corporation has only one class of stock,it will be common stock.

Voting rights are a characteristic of which type stock?

Preferred stockholders have what right over common stockholders?

When a company distributes some of their profits to shareholders,it is in the form of:

The Articles of Incorporation are submitted to the Secretary of State.

Using the following accounts: [1] Cash [2] Subscription receivable common stock [3] Machinery [4] Building [5] Land [6] Organization costs [7] Preferred stock [8] Common stock [9] Paid in capital in excess of par preferred stock [10] Paid in capital in excess of par common stock [11] Common stock subscribed [12] Discount on common stock [13] Amortization expense organization costs Indicate the account(s) to be debited and credited to record the following transactions. -Sold common stock at a price above the par value. Debit ________& ________ & ________ Credit ________ & ________ & ________

Common stock was sold in excess of par; the excess was credited to Sales.This error would cause:

A form issued by the corporation that shows the name of the stockholder and the number of shares owned is called a(n):

Journalize the transactions for the stock subscription plan for Rico Company.On February 1,Rico received subscriptions for 50 shares of $9 par value common stock at $16 per share.The buyer will pay two equal installments on March 1 and June 1.Assume all payments are made as scheduled and the company issues the stock after the June 1 collection.

Corporations are subject to more government regulations than sole proprietorships and partnerships.

Custer.com Company's outstanding stock is 100 shares of $100,6% cumulative nonparticipating preferred stock and 1,000 shares of $10 par value common stock.Custer paid $2,000 cash dividends including one-year dividends in arrears to preferred stockholders.Common stockholders received:

The financial loss that each stockholder in a corporation can incur is limited to the amount invested by the stockholder.