Exam 14: The Corporate Income Statement and the Statement of Stockholders Equity

A company had 48,000 shares outstanding from January 1 to June 1 and 72,000 shares outstanding from June 1 to December 31. What is the weighted-average number of shares used in earnings per share calculations?

A company had the following amounts of common stock outstanding: 9,000 shares from January through April, 15,000 shares from May through October, and 25,000 shares from November through December. What is the weighted-average number of shares rounded to nearest dollar used in earnings per share calculations?

Which of the following is analyzed when a financial statement reader is looking at the nature of nonoperating items?

A stock dividend exceeding 20 to 25 percent is properly treated as a stock split.

A company with no potentially dilutive securities is considered to have a complex capital structure.

A business with 100,000 shares of stock outstanding for three months would use a weighted-average 25,000 shares in its earnings per share calculation.

Book value per share of stock represents the amount the shareholder will receive per share if the company is sold or liquidated.

The book value of one share of callable preferred stock is equal to the call value of the preferred share minus any dividends in arrears.

A person owning stock on the date of record will receive stock dividends that have been declared.

The federal income tax is progressive in nature.

On May 1, 2010, Bryson Corporation had 200,000 shares of $100 par value common stock outstanding with a market value of $160 per share. On May 2, 2010, Bryson announced a 4-for-1 stock split. After the split, the par value of the stock

The declaration of cash dividends will decrease the book value per share of common stock.

The quality of a company's earnings may be affected by the

How do the accounting conventions of full disclosure and consistency facilitate the interpretation of the quality of earnings?

On December 31, 2009, Voss Corporation had 150,000 shares of common stock issued and outstanding. On October 1, 2010, an additional 20,000 shares of common stock were issued for cash. During 2010, Voss declared and paid dividends of $100,000 on its 10,000 shares of nonconvertible preferred stock. During 2010, Voss declared and paid dividends of $80,000 on its common stock. Net income for 2010 amounted to $500,000. The earnings per share of common stock (rounded to the nearest cent) for 2010 are

For an item to be treated as extraordinary, it must be unusual in nature and occur infrequently.

The write-down of an asset will affect

A business with a simple capital structure would present only basic earnings per share information in its financial statements.

A company with a simple capital structure is required to report both basic and diluted earnings per share.

Deferred Income Taxes is classified as an asset when it has a debit balance.