Exam 13: Corporations

XD7,Inc.has 50,000 shares of common stock outstanding and 2,000 shares of preferred stock outstanding.The common stock has a $1.00 par value.The preferred stock has a $100 par value,a 5% dividend rate,and is noncumulative.On October 31,2018,the company declares the annual preferred dividend and dividends of $0.25 per share for common.Prepare the journal entry for the declaration of dividends.Omit explanation.

A corporation declares a dividend of $0.50 per share on 18,000 shares of common stock.Which of the following is included in the entry to record the declaration?

Belton,Inc.had the following transactions in 2018,its first year of operations: • Issued 33,000 shares of common stock.Stock has par value of $1.00 per share and was issued at $24.00 per share. • Earned net income of $73,000. • Paid no dividends. At the end of 2018,what is the total amount of paid-in capital?

FASB requires that earnings per share be reported on the income statement.

Which of the following items are NOT reported as part of income from continuing operations?

Which of the following statements regarding income from continuing operations is incorrect?

Fallingstar,Inc.has 110,000 shares of common stock issued and outstanding,with a par value of $0.03 per share.It declared a 17% common stock dividend; market value is $14 per share.Which of the following is the correct journal entry to record the transaction? (Round your answers to the nearest whole dollar.)

The income from continuing operations helps investors make predictions about the company's past performance.

The statement of stockholders' equity ________.

Adams Corporation's accounting records include the following items for the year ending December 31,2019: The income tax rate for the company is 25%.Prepare Adams' multi-step income statement for the year ended December 31,2019.Omit earnings per share.

Which of the following corporate characteristics is a disadvantage of a corporation?

The following information is from the December 31,2018 balance sheet of Millner Corporation. Preferred Stock, \ 100 par \ 560,000 Paid-In Capital in Excess of Par-Preferred 43,000 Common Stock, \ 1 par 190,000 Paid-In Capital in Excess of Par-Common 510,000 Retained Earnings Total Stockholders' Equity \ 1,494,500 What was the average issue price of the common stock shares? (Round your answer to the nearest cent.)

The price/earnings ratio ________.

A corporation issues 16,000 shares of its $3 stated value common shares.The issue price is $9 per share.The credit to the Common Stock account is $144,000.

Which of the following best describes the appropriation of retained earnings?

The 2019 balance sheet for Standard Electronics reported the following items - with 2018 figures given for comparison: Net income for 2019 was $25,000.Compute the rate of return on common stockholders' equity for 2019.(Round your final answer to two decimal places.)

Preferred stockholders ________.

Corporations may not retire preferred stock in order to avoid paying the preferred dividends.

Paid-in capital consists of ________.

Define treasury stock and provide two reasons why a corporation would purchase treasury stock.