Exam 8: Accounting for Shareholders Equity

A company has 2,000 shares of $100 par,6%,noncumulative preferred stock outstanding.If the board of directors declares a dividend this year,how much will the preferred shareholders receive?

Team Shirts issued 20,000 shares of $2 par value stock for $20 per share.This transaction increased Cash $400,000 and increased Common stock ________.

Which of these comes first?

In exchange for stock,corporations may receive ________.

A stock split ________ total shareholders' equity.

Paid-in capital includes ________

Retained earnings is the amount owners have invested in a corporation.

Risks associated with owning an investment in a company's stock include the risk that ________.

On June 15,Team Shirts paid a cash dividend of $0.75 per share to common shareholders.There were 45,000 shares issued at the time.Team Shirts held 1,000 shares of treasury stock.Team Shirts also paid a dividend to preferred shareholders.There were 200 shares of 8%,$100 par preferred stock outstanding.What was the total dollar amount of the cash dividend?

Team Shirts issued a 10% stock dividend.The balance in retained earnings just before the dividend was $45,000.There were 15,000 shares outstanding on the day of the dividend.The $1 par value stock had a market price of $17.25 on the day of the dividend.Total shareholders' equity will increase (decrease)by ________.

The purchase of treasury stock ________.

The following information is available for TWO years ended December 31,20111 and 2012: 1.From which financial statement did the above information come? 2.If this company declared dividends of $4,000 in 2012,how much income did it earn that year? 3.What event could have caused Treasury stock to change from $(600)in 2011 to $(2,600)in 2012? 4.How many shares of common stock are issued at the end of 2011? 5.How many shares of common stock are issued at the end of 2012? 6.What event could have caused the change in the common stock account from 2011 to 2012? 7.What was the average price of the common stock issued during 2012?

Common stock has preference over preferred stock when dividends are paid.

Ice Video Corporation had an average common shareholders' equity of $423,785.The company had net income during the year of $213,465.There were 258,000 shares of common stock outstanding throughout the year and no preferred stock at any time.Calculate return on equity (round to the nearest tenth of a percent).

The owners of common stock do NOT have the specific right to ________.

What are dividends?

Romax Company had net income of $147,000.The balance sheet showed beginning and ending balance in shareholders' equity of $750,000 and $790,000,respectively.There were no preferred shares and 69,000 common shares outstanding throughout the year.Calculate earnings per share.

Stock splits occur when a corporation wants to increase the market price per share of its stock.

Use the information below to answer the following question: Common stock,$1 par,100,000 shares authorized, What is the average price for which a share of stock was issued?

Fitch purchased 100 shares of Tommy Hilfiger,Inc.'s common stock for a total of $2,000.Mr.Fitch sells the 100 shares to Mr.Abercrombie for $2,300.This sale will cause Tommy Hilfiger,Inc.'s ________.