Exam 12: Contributed Capital

Dividends in arrears are forfeited when a corporation calls in its preferred stock.

The liability of a stockholder is usually limited to the stockholder's investment in the corporation.

Honig Corporation had the following shares of stock outstanding on December 31, 2010 : Common stock, $50 par value, 100,000 shares outstanding Preferred stock, 8 percent, $100 par value, cumulative, 10,000 shares outstanding Dividends were in arrears for 2008 and 2009. On December 31, 2010 , total cash dividends of $400,000 were declared. The total amounts payable to preferred stockholders and common stockholders, respectively, are

The par value of stock refers to its value on the open market.

Par value

Which of the following statements is true of stock option plans?

Start-up and organization costs for a corporation that is to operate a retail store would include the costs of

Prepare entries in journal form without explanations to record the following transactions involving Dailey Corporation's $5 par value common stock:

Start-up and organization costs include all of the following except

Return on equity equals average stockholders' equity divided by net income.

The sale of shares in a corporation by one stockholder to another affects the total capital of the corporation.

Retained earnings consist of a pool of funds to be distributed to stockholders.

The price/earnings (P/E) ratio is measured in terms of

Gault Corporation had the following shares of stock outstanding on December 31, 2010: Common stock, $50 par value, 200,000 shares outstanding Preferred stock, 8 percent, $100 par value, cumulative, 20,000 shares outstanding Dividends were in arrears for 2008 and 2009. On December 31, 2010, total cash dividends of $800,000 were declared. The total amounts payable to preferred stockholders and common stockholders, respectively, are

On June 1, 2008 , Will Oldman, treasurer of A-One Corporation, received an option to purchase 2,000 shares of A-One $5 par value common stock for $20 per share any time during 2009 or 2010. Oldman exercised his option on May 14, 2009. The market price of the stock was $20 per share on June 1, 2008, and $25 per share on May 14, 2009. Provide the entry in journal form to record the exercise of the option on A-One's books. Show computations. (Omit explanation.)

To evaluate the amount of dividends they receive, investors use the ratio called

Use the following information to answer the question below. On January 1, 2010, Falcon Corporation had 40,000 shares of $10 par value common stock issued and outstanding. All 40,000 shares had been issued in a prior period at $17 per share. On February 1, 2010, Falcon purchased 3,100 shares of treasury stock for $19 per share and later sold the treasury shares for $26 per share on March 2, 2010. What amount of gain due to these treasury stock transactions should be reported on the income statement for the year ended December 31, 2010 ?

Kagel Corporation had 30,000 shares of $5 par value common stock issued and outstanding on December 31, 2009. Each share was issued during 2007 at $14 per share. Prepare the entries in journal form without explanations for the following transactions occurring in 2010:

Once an owner of convertible preferred stock has converted to common, he or she cannot convert back to preferred.

Cash dividends become a liability of a corporation when the stock goes ex-dividend.