Question 1

A company issues no-par value with no stated value stock. Therefore, the company does not have a minimum legal capital amount.

Accepted Answer

A) True 
 B)False

Question 2

Washington Corporation issued 4,000 shares of its $20 par value common stock for $23 per share. The entry to record the issuance would include a:

Accepted Answer

A) debit to Cash for $80,000. 
B) credit to Common Stock for $12,000. 
C) credit to Common Stock for $80,000. 
D) debit to Paid-in Capital in Excess of Par Value for $12,000. 
A) debit to Cash for $80,000. 
B) credit to Common Stock for $12,000. 
C) credit to Common Stock for $80,000. 
D) debit to Paid-in Capital in Excess of Par Value for $12,000.

Question 3

Rhubarb Corporation's outstanding stock is 100 shares of $100, 11% cumulative nonparticipating preferred stock and 2,000 shares of $12 par value common stock. Rhubarb paid $1,600 cash dividends during the year. Common stockholders received:

Accepted Answer

A) $0. 
B) $500. 
C) $2,500. 
D) $1,100. 
A) $0. 
B) $500. 
C) $2,500. 
D) $1,100.

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A) the period end stockholders' equity to be overstated. 
B) the period end stockholders' equity to be understated. 
C) the period's net income to be understated. 
D) None of these are correct. 
A) the period end stockholders' equity to be overstated. 
B) the period end stockholders' equity to be understated. 
C) the period's net income to be understated. 
D) None of these are correct.

Question 6

Issued stock is:

Accepted Answer

A) authorized shares of stock that can be sold. 
B) stock only sold to another company. 
C) shares sold and in stockholders' possession. 
D) stock sold to stockholders. 
A) authorized shares of stock that can be sold. 
B) stock only sold to another company. 
C) shares sold and in stockholders' possession. 
D) stock sold to stockholders.

Question 7

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

Accepted Answer

A) cumulative stock. 
B) reduced taxes. 
C) dividends. 
D) bonds. 
A) cumulative stock. 
B) reduced taxes. 
C) dividends. 
D) bonds.

Question 8

Characteristics of a corporation include:

Accepted Answer

A) stockholders having unlimited liability. 
B) direct management by the stockholders. 
C) stockholders having limited liability. 
D) choosing a board of directors. 
A) stockholders having unlimited liability. 
B) direct management by the stockholders. 
C) stockholders having limited liability. 
D) choosing a board of directors.

Question 9

What is the entry to record subscriptions received for 1,700 shares of $100 par value common stock at $130 per share?

Accepted Answer

A) Debit Common Stock Subscribed $221,000; credit Cash $221,000 
B) Debit Subscriptions Receivable-Common Stock $221,000; credit Common Stock Subscribed $221,000 
C) Debit Subscriptions Receivable-Common Stock $221,000; credit Common Stock $221,000 
D) None of these answers are correct. 
A) Debit Common Stock Subscribed $221,000; credit Cash $221,000 
B) Debit Subscriptions Receivable-Common Stock $221,000; credit Common Stock Subscribed $221,000 
C) Debit Subscriptions Receivable-Common Stock $221,000; credit Common Stock $221,000 
D) None of these answers are correct.

Question 10

Using the following accounts:
   Indicate the account(s)to be debited and credited to record the following transactions.
-Exchanged common stock for machinery when the stock was selling at a premium.
Debit ________& ________ & ________ Credit ________ & ________ & ________

Accepted Answer

Debit 3, C

Question 11

A change in ownership terminates the corporation.

Accepted Answer

A) True 
 B)False

Question 12

The Harvester Corporation issued 40 shares of $20 par value stock to its accountant. The shares are in full payment for her $900 fee for assistance in setting up the new company. The entry to record the issuance of the stock would include a:

Accepted Answer

A) credit to Common Stock for $900. 
B) debit to Common Stock for $900. 
C) credit to Common Stock for $800. 
D) debit to Common Stock for $800. 
A) credit to Common Stock for $900. 
B) debit to Common Stock for $900. 
C) credit to Common Stock for $800. 
D) debit to Common Stock for $800.

Question 13

Alpha-Omega Industries has 30,000 shares of $12 par common stock and 15,000 shares of $50 par, 5% preferred stock outstanding. Total dividends available are $162,000. Compute the dividends to be distributed to preferred and common stockholders under the following condition.
The preferred stock is nonparticipating and cumulative with no dividends distributed last year.

Accepted Answer

Preferred Stock: $50

Question 14

Antiques.com Corporation's outstanding stock is 75 shares of $60, 8% cumulative nonparticipating preferred stock and 2,000 shares of $10 par value common stock. Antiques paid $2,400 cash dividends during the year. Common stockholders received:

Accepted Answer

A) $2,400. 
B) $360. 
C) $2,040. 
D) $0. 
A) $2,400. 
B) $360. 
C) $2,040. 
D) $0.

Question 15

Stockholders' investment appears in:

Accepted Answer

A) Paid-in Capital. 
B) Owner's Equity. 
C) Retained Earnings. 
D) Cash. 
A) Paid-in Capital. 
B) Owner's Equity. 
C) Retained Earnings. 
D) Cash.

Question 16

Stockholders pay federal income tax on their stock dividends.

Accepted Answer

A) True 
 B)False

Question 17

Authorized capital stock is:

Accepted Answer

A) shares listed in the charter. 
B) shares issued to the corporation's officers. 
C) shares sold and in stockholder possession. 
D) shares that pay dividends. 
A) shares listed in the charter. 
B) shares issued to the corporation's officers. 
C) shares sold and in stockholder possession. 
D) shares that pay dividends.

Question 18

Organization costs are:

Accepted Answer

A) part of the company's start-up and are listed as expenses. 
B) listed as an intangible asset on the balance sheet. 
C) a current asset on the balance sheet. 
D) another expense on the income statement. 
A) part of the company's start-up and are listed as expenses. 
B) listed as an intangible asset on the balance sheet. 
C) a current asset on the balance sheet. 
D) another expense on the income statement.

Question 19

Journalize the following independent transactions:
a)Casey Company sells 250 shares of $20 par-value common stock at $20.
b)Jacob Corporation sells 100 shares of $15 par-value common stock at $20.
c)Moss Inc. sells 40 shares of no-par common stock with a $15 stated value for $30 per share.

Accepted Answer

The answer of Journalize the following independent transactions:
a)Casey Company sells...

Question 20

Using the following accounts:
   Indicate the account(s)to be debited and credited to record the following transactions.
-Exchanged common stock for services of corporation organizers (valued at par).
Debit ________ & ________ & ________ Credit ________ & ________ & ________

Accepted Answer

The answer of Using the following accounts:
   Indicate...

Exam 18: Corporations: Organizations and Stock

A company issues no-par value with no stated value stock. Therefore, the company does not have a minimum legal capital amount.

Washington Corporation issued 4,000 shares of its $20 par value common stock for $23 per share. The entry to record the issuance would include a:

Rhubarb Corporation's outstanding stock is 100 shares of $100, 11% cumulative nonparticipating preferred stock and 2,000 shares of $12 par value common stock. Rhubarb paid $1,600 cash dividends during the year. Common stockholders received:

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

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

Issued stock is:

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

Characteristics of a corporation include:

What is the entry to record subscriptions received for 1,700 shares of $100 par value common stock at $130 per share?

Using the following accounts: Indicate the account(s)to be debited and credited to record the following transactions. -Exchanged common stock for machinery when the stock was selling at a premium. Debit ________& ________ & ________ Credit ________ & ________ & ________

A change in ownership terminates the corporation.

The Harvester Corporation issued 40 shares of $20 par value stock to its accountant. The shares are in full payment for her $900 fee for assistance in setting up the new company. The entry to record the issuance of the stock would include a:

Antiques.com Corporation's outstanding stock is 75 shares of $60, 8% cumulative nonparticipating preferred stock and 2,000 shares of $10 par value common stock. Antiques paid $2,400 cash dividends during the year. Common stockholders received:

Stockholders' investment appears in:

Stockholders pay federal income tax on their stock dividends.

Authorized capital stock is:

Organization costs are:

Journalize the following independent transactions: a)Casey Company sells 250 shares of $20 par-value common stock at $20. b)Jacob Corporation sells 100 shares of $15 par-value common stock at $20. c)Moss Inc. sells 40 shares of no-par common stock with a $15 stated value for $30 per share.

Using the following accounts: Indicate the account(s)to be debited and credited to record the following transactions. -Exchanged common stock for services of corporation organizers (valued at par). Debit ________ & ________ & ________ Credit ________ & ________ & ________

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying, Recording, and Reporting Payroll and Payroll Taxes: the Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, Plant, Equipment, and Intangible Assets

Partnership

Corporations: Stock Values, Dividends, Treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

Using the following accounts: Indicate the account(s)to be debited and credited to record the following transactions. -Exchanged common stock for machinery when the stock was selling at a premium. Debit & & Credit & &

Using the following accounts: Indicate the account(s)to be debited and credited to record the following transactions. -Exchanged common stock for services of corporation organizers (valued at par). Debit & & Credit & &