Question 1

If a company retires preferred stock,________.

Accepted Answer

A) total stockholders' equity will decrease 
B) total stockholders' equity will increase 
C) the company can record a gain or loss on retirement of stock 
D) the number of outstanding shares will increase 
A) total stockholders' equity will decrease 
B) total stockholders' equity will increase 
C) the company can record a gain or loss on retirement of stock 
D) the number of outstanding shares will increase

Question 2

On November 1,2017,McEwing,Inc.declared a dividend of $6.00 per share.McEwing,Inc.has 24,000 shares of common stock outstanding and no preferred stock.The date of record is November 15,and the payment date is November 30,2017.Which of the following is the journal entry needed on November 30,2017?

Accepted Answer

A) Debit Cash Dividends $144,000,and credit Dividends Payable-Common $144,000. 
B) Debit Dividends Payable-Common $144,000,and credit Cash $144,000. 
C) Debit Cash $144,000,and credit Dividends Payable-Common $144,000. 
D) Debit Cash Dividends $144,000,and credit Cash $144,000. 
A) Debit Cash Dividends $144,000,and credit Dividends Payable-Common $144,000. 
B) Debit Dividends Payable-Common $144,000,and credit Cash $144,000. 
C) Debit Cash $144,000,and credit Dividends Payable-Common $144,000. 
D) Debit Cash Dividends $144,000,and credit Cash $144,000.

Question 3

When a corporation retires its shares of treasury stock,the stock certificates are canceled.

Accepted Answer

A) True 
 B)False

Question 4

The statement of stockholders' equity ________.

Accepted Answer

A) reports the number of shares and any changes during the year in preferred,common,and treasury stock 
B) is required to be presented along with the statement of retained earnings 
C) is not required by IFRS 
D) does not show the changes to the Retained Earnings account because that information is provided in the statement of retained earnings 
A) reports the number of shares and any changes during the year in preferred,common,and treasury stock 
B) is required to be presented along with the statement of retained earnings 
C) is not required by IFRS 
D) does not show the changes to the Retained Earnings account because that information is provided in the statement of retained earnings

Question 5

The following information is from the December 31,2017 balance sheet of Tudor Corporation.
 
What was the total paid-in capital as of December 31,2017?

Accepted Answer

A) $686,000 
B) $992,900 
C) $909,000 
D) $888,000 
A) $686,000 
B) $992,900 
C) $909,000 
D) $888,000

Question 6

Retired shares of treasury stock may later be reissued.

Accepted Answer

A) True 
 B)False

Question 7

Retained earnings represents amounts received from stockholders of a corporation in exchange for stock.

Accepted Answer

A) True 
 B)False

Question 8

A deficit occurs when a company has reoccurring losses and/or declares dividends in excess of retained earnings.

Accepted Answer

A) True 
 B)False

Question 9

Refer to the following information for Tangent Corporation:
• Common Stock,$1.00 par,114,000 shares issued,98,000 shares outstanding
• Paid-In Capital in Excess of Par-Common: $2,150,000
• Retained Earnings: $930,000
• Treasury Stock: 10,000 shares purchased at $35 per share
If Tangent resold 1,300 shares of treasury stock for $22.50 per share,which of the following statements would be true?

Accepted Answer

A) The Treasury Stock account would decrease by $22,750. 
B) The Paid-In Capital in Excess of Par-Common account would increase by $1,300. 
C) The Treasury Stock account would decrease by $45,500. 
D) The Retained Earnings account would increase by $29,250. 
A) The Treasury Stock account would decrease by $22,750. 
B) The Paid-In Capital in Excess of Par-Common account would increase by $1,300. 
C) The Treasury Stock account would decrease by $45,500. 
D) The Retained Earnings account would increase by $29,250.

Question 10

A net loss for the year decreases the balance in Retained Earnings.

Accepted Answer

A) True 
 B)False

Question 11

Sanella Corporation reported the following equity section on its current balance sheet.The common stock is currently selling for $13.75 per share.
 
What would be the balance in the Common Stock account after the issuance of a 12% stock dividend?

Accepted Answer

A) $360,000 
B) $387,200 
C) $492,800 
D) $440,000 
A) $360,000 
B) $387,200 
C) $492,800 
D) $440,000

Question 12

Dallkin Corporation issued 8,000 shares of common stock on January 1,2017.The stock has no par value and was issued at $22 per share.The journal entry for this transaction includes a ________.

Accepted Answer

A) debit to Cash for $176,000 and a credit to Common Stock-No-Par Value for $176,000 
B) debit to Cash for $176,000 and a credit to Paid-In Capital in Excess of Par-Common for $176,000 
C) credit to Cash for $176,000 and a debit to Common Stock-No-Par Value for $176,000 
D) credit to Cash for $176,000,a debit to Paid-In Capital in Excess of Par-Common for $8,000,and a debit to Common Stock-No-Par Value for $168,000 
A) debit to Cash for $176,000 and a credit to Common Stock-No-Par Value for $176,000 
B) debit to Cash for $176,000 and a credit to Paid-In Capital in Excess of Par-Common for $176,000 
C) credit to Cash for $176,000 and a debit to Common Stock-No-Par Value for $176,000 
D) credit to Cash for $176,000,a debit to Paid-In Capital in Excess of Par-Common for $8,000,and a debit to Common Stock-No-Par Value for $168,000

Question 13

Restrictions on retained earnings are ________.

Accepted Answer

A) reported on the statement of cash flows 
B) usually reported in the notes to the financial statements 
C) reported on the income statement 
D) designed to maximize dividends paid to shareholders 
A) reported on the statement of cash flows 
B) usually reported in the notes to the financial statements 
C) reported on the income statement 
D) designed to maximize dividends paid to shareholders

Question 14

On June 30,2017,Martin Brothers,Inc.showed the following data on the equity section of their balance sheet:
 
On July 1,2017,the company declared and distributed a 9% stock dividend.The market value of the stock at that time was $16 per share.Following this transaction,what is the balance of Paid-In Capital in Excess of Par-Common?

Accepted Answer

A) $221,400 
B) $546,750 
C) $270,000 
D) $459,000 
A) $221,400 
B) $546,750 
C) $270,000 
D) $459,000

Question 15

Marketplace,Inc.completed the following treasury stock transactions in 2016:
   
Journalize these transactions.Explanations are not required.
How will Marketplace,Inc.report treasury stock on its balance sheet as of December 31,2016?

Accepted Answer

@#IMG-DLM& Marketplace,Inc.will report t

Question 16

On June 30,2017,Stephans,Inc.showed the following data on the equity section of their balance sheet:
 
On July 1,2017,the company declared and distributed a 6% stock dividend.The market value of the stock at that time was $15 per share.Following this transaction,what is total stockholders' equity?

Accepted Answer

A) $1,369,000 
B) $1,545,380 
C) $1,295,920 
D) $1,185,400 
A) $1,369,000 
B) $1,545,380 
C) $1,295,920 
D) $1,185,400

Question 17

Which of the following is true of dividends?

Accepted Answer

A) Dividends are a distribution of cash,stock,or other property to stockholders. 
B) Dividends increase assets and decrease total stockholders' equity of a corporation. 
C) Dividend payments decrease paid-in capital. 
D) Dividend payments increase stockholders' equity. 
A) Dividends are a distribution of cash,stock,or other property to stockholders. 
B) Dividends increase assets and decrease total stockholders' equity of a corporation. 
C) Dividend payments decrease paid-in capital. 
D) Dividend payments increase stockholders' equity.

Question 18

Paid-in capital consists of ________.

Accepted Answer

A) amounts received from customers 
B) amounts raised by issuing bonds or preferred stocks 
C) earnings generated by the corporation 
D) amounts received from stockholders in exchange for stock 
A) amounts received from customers 
B) amounts raised by issuing bonds or preferred stocks 
C) earnings generated by the corporation 
D) amounts received from stockholders in exchange for stock

Question 19

A small stock dividend,a large stock dividend and a stock split have no effect on total assets.

Accepted Answer

A) True 
 B)False

Question 20

Happy Holidays,Inc.has 113,000 shares of common stock issued and outstanding,with a par value of $0.01 per share.It declared a 17% common stock dividend;market value is $12 per share.Which of the following is the correct journal entry to record the transaction? (Round your answers to the nearest whole dollar. )

Accepted Answer

A) debit Stock Dividends $230,520 and credit Paid-In Capital in Excess of Par-Common $230,520 
B) debit Stock Dividends $230,520,credit Common Stock Dividend Distributable $192,and credit Paid-In Capital in Excess of Par-Common $230,328 
C) debit Stock Dividends $230,520 and credit Cash $230,520 
D) debit Common Stock Dividend Distributable $192,debit Paid-In Capital in Excess of Par-Common $230,328,and credit Retained Earnings $230,520 
A) debit Stock Dividends $230,520 and credit Paid-In Capital in Excess of Par-Common $230,520 
B) debit Stock Dividends $230,520,credit Common Stock Dividend Distributable $192,and credit Paid-In Capital in Excess of Par-Common $230,328 
C) debit Stock Dividends $230,520 and credit Cash $230,520 
D) debit Common Stock Dividend Distributable $192,debit Paid-In Capital in Excess of Par-Common $230,328,and credit Retained Earnings $230,520

Exam 13: Corporations

If a company retires preferred stock,________.

On November 1,2017,McEwing,Inc.declared a dividend of $6.00 per share.McEwing,Inc.has 24,000 shares of common stock outstanding and no preferred stock.The date of record is November 15,and the payment date is November 30,2017.Which of the following is the journal entry needed on November 30,2017?

When a corporation retires its shares of treasury stock,the stock certificates are canceled.

The statement of stockholders' equity ________.

The following information is from the December 31,2017 balance sheet of Tudor Corporation. What was the total paid-in capital as of December 31,2017?

Retired shares of treasury stock may later be reissued.

Retained earnings represents amounts received from stockholders of a corporation in exchange for stock.

A deficit occurs when a company has reoccurring losses and/or declares dividends in excess of retained earnings.

A net loss for the year decreases the balance in Retained Earnings.

Sanella Corporation reported the following equity section on its current balance sheet.The common stock is currently selling for $13.75 per share. What would be the balance in the Common Stock account after the issuance of a 12% stock dividend?

Dallkin Corporation issued 8,000 shares of common stock on January 1,2017.The stock has no par value and was issued at $22 per share.The journal entry for this transaction includes a ________.

Restrictions on retained earnings are ________.

Marketplace,Inc.completed the following treasury stock transactions in 2016: Journalize these transactions.Explanations are not required. How will Marketplace,Inc.report treasury stock on its balance sheet as of December 31,2016?

On June 30,2017,Stephans,Inc.showed the following data on the equity section of their balance sheet: On July 1,2017,the company declared and distributed a 6% stock dividend.The market value of the stock at that time was $15 per share.Following this transaction,what is total stockholders' equity?

Which of the following is true of dividends?

Paid-in capital consists of ________.

A small stock dividend,a large stock dividend and a stock split have no effect on total assets.

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Recording Business Transactions

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Merchandise Inventory

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Internal Control and Cash

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Current Liabilities and Payroll

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The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

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