Question 1

Significant changes in stockholders' equity are reported in the

Accepted Answer

A) statement of stockholders' equity. 
B) income statement. 
C) retained earnings statement. 
D) statement of cash flows. 
A) statement of stockholders' equity. 
B) income statement. 
C) retained earnings statement. 
D) statement of cash flows.

Question 2

During the first year of operations,a company granted warranties on its products.The estimated cost of the product warranty liability at the end of the year is $12,750.The product warranty expense of $12,750 should be recorded in the year the related product sale is made.

Accepted Answer

A) True 
 B)False

Question 3

Most employers are required to withhold from employees for

Accepted Answer

A) both federal and state unemployment compensation. 
B) only federal unemployment compensation tax. 
C) only federal income tax. 
D) only state unemployment compensation tax. 
A) both federal and state unemployment compensation. 
B) only federal unemployment compensation tax. 
C) only federal income tax. 
D) only state unemployment compensation tax.

Question 4

If the market rate of interest is 8% and a corporation's bonds bear interest at 7%,the bonds will sell at a premium.

Accepted Answer

A) True 
 B)False

Question 5

When a corporation issues bonds,it executes a contract with the bondholders known as a bond debenture.

Accepted Answer

A) True 
 B)False

Question 6

If 20,000 shares are authorized,15,000 shares are issued,and 500 shares are reacquired,the number of outstanding shares is 19,500.

Accepted Answer

A) True 
 B)False

Question 7

Which statement below is NOT a reason for a corporation to buy back its own stock?

Accepted Answer

A) Resale to employees 
B) Bonus to employees 
C) For supporting the market price of the stock 
D) To increase the shares outstanding 
A) Resale to employees 
B) Bonus to employees 
C) For supporting the market price of the stock 
D) To increase the shares outstanding

Question 8

The par value of common stock is rarely equal to its market value on the date the stock is issued.

Accepted Answer

A) True 
 B)False

Question 9

Most employers are required to withhold federal unemployment taxes from employee earnings.

Accepted Answer

A) True 
 B)False

Question 10

The par value per share of common stock represents

Accepted Answer

A) the minimum selling price of the stock established by the articles of incorporation. 
B) the minimum amount the stockholder will receive when the corporation is liquidated. 
C) the monetary amount assigned to each share of stock in the articles of incorporation. 
D) the amount of dividends per share to be received each year. 
A) the minimum selling price of the stock established by the articles of incorporation. 
B) the minimum amount the stockholder will receive when the corporation is liquidated. 
C) the monetary amount assigned to each share of stock in the articles of incorporation. 
D) the amount of dividends per share to be received each year.

Question 11

The following information is for employee William Heedy for the week ended March 15.
Total hours worked: 48
Rate: $16 per hour,with double time for all hours in excess of 40
Federal income tax withheld: $200
United Fund deduction: $50
Cumulative earnings prior to current week: $6,400
Tax rates:
Social security: 6% on maximum earnings of $106,800
Medicare tax: 1.5% on all earnings;on both employer and employee
State unemployment: 3.4% on maximum earnings of $7,000;on employer
Federal unemployment: 0.8% on maximum earnings of $7,000;on employer

Accepted Answer

The answer of The following information is for employee William...

Question 12

One of the prerequisites required to pay a cash dividend is formal action by the board of directors.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is characteristic of deferred income tax payable?

Accepted Answer

A) Deferred income tax payable is often generated due to timing differences. 
B) Deferred income tax payable may be either a current or long-term liability 
C) Deferred income tax payable represents the deferred payment of taxes to later years through tax planning techniques. 
D) All of these are characteristics of deferred income tax payable. 
A) Deferred income tax payable is often generated due to timing differences. 
B) Deferred income tax payable may be either a current or long-term liability 
C) Deferred income tax payable represents the deferred payment of taxes to later years through tax planning techniques. 
D) All of these are characteristics of deferred income tax payable.

Question 14

If 50,000 shares are authorized,35,000 shares are issued,and 1,000 shares are reacquired,the number of outstanding shares is 36,000.

Accepted Answer

A) True 
 B)False

Question 15

An employee receives an hourly rate of $27,with time and a half for all hours worked
In excess of 40 during a week.Payroll data for the current week are as follows: hours worked,46;federal income tax withheld,$350;cumulative earnings for year prior to current week,$99,700;social security tax rate,6.0% on maximum of $106,800;and Medicare tax rate,1.5% on all earnings.What is the gross pay for the employee?

Accepted Answer

A) $798.85 
B) $873.77 
C) $1,242.00 
D) $1,323.00 
A) $798.85 
B) $873.77 
C) $1,242.00 
D) $1,323.00

Question 16

The main source of paid-in-capital is from issuing stock.

Accepted Answer

A) True 
 B)False

Question 17

The summary of the payroll for the monthly pay period ending July 15 indicated the following:
   
Illustrate the effects on the accounts and the financial statements of (a)the payroll and (b)the employer's payroll tax expense for the month.The state unemployment tax rate is 5.4%,and the federal unemployment tax rate is 0.8%.Only $30,000 of salaries are subject to unemployment taxes.

Accepted Answer

The answer of The summary of the payroll for the...

Question 18

How is treasury stock shown on the balance sheet?

Accepted Answer

A) As an asset 
B) As a decrease in stockholders' equity 
C) As an increase in stockholders' equity 
D) Treasury stock is not shown on the balance sheet. 
A) As an asset 
B) As a decrease in stockholders' equity 
C) As an increase in stockholders' equity 
D) Treasury stock is not shown on the balance sheet.

Question 19

The liability for a dividend is recorded on which of the following dates?

Accepted Answer

A) The date of record 
B) The date of payment 
C) The date of announcement 
D) The date of declaration 
A) The date of record 
B) The date of payment 
C) The date of announcement 
D) The date of declaration

Question 20

The primary purpose of a stock split is to reduce the number of shares outstanding in order to encourage more investors to enter the market for the company's shares.

Accepted Answer

A) True 
 B)False

Significant changes in stockholders' equity are reported in the

During the first year of operations,a company granted warranties on its products.The estimated cost of the product warranty liability at the end of the year is $12,750.The product warranty expense of $12,750 should be recorded in the year the related product sale is made.

Most employers are required to withhold from employees for

If the market rate of interest is 8% and a corporation's bonds bear interest at 7%,the bonds will sell at a premium.

When a corporation issues bonds,it executes a contract with the bondholders known as a bond debenture.

If 20,000 shares are authorized,15,000 shares are issued,and 500 shares are reacquired,the number of outstanding shares is 19,500.

Which statement below is NOT a reason for a corporation to buy back its own stock?

The par value of common stock is rarely equal to its market value on the date the stock is issued.

Most employers are required to withhold federal unemployment taxes from employee earnings.

The par value per share of common stock represents

One of the prerequisites required to pay a cash dividend is formal action by the board of directors.

Which of the following is characteristic of deferred income tax payable?

If 50,000 shares are authorized,35,000 shares are issued,and 1,000 shares are reacquired,the number of outstanding shares is 36,000.

The main source of paid-in-capital is from issuing stock.

How is treasury stock shown on the balance sheet?

The liability for a dividend is recorded on which of the following dates?

The primary purpose of a stock split is to reduce the number of shares outstanding in order to encourage more investors to enter the market for the company's shares.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

Exam 8: Liabilities and Stockholders Equity

Significant changes in stockholders' equity are reported in the

During the first year of operations,a company granted warranties on its products.The estimated cost of the product warranty liability at the end of the year is $12,750.The product warranty expense of $12,750 should be recorded in the year the related product sale is made.

Most employers are required to withhold from employees for

If the market rate of interest is 8% and a corporation's bonds bear interest at 7%,the bonds will sell at a premium.

When a corporation issues bonds,it executes a contract with the bondholders known as a bond debenture.

If 20,000 shares are authorized,15,000 shares are issued,and 500 shares are reacquired,the number of outstanding shares is 19,500.

Which statement below is NOT a reason for a corporation to buy back its own stock?

The par value of common stock is rarely equal to its market value on the date the stock is issued.

Most employers are required to withhold federal unemployment taxes from employee earnings.

The par value per share of common stock represents

One of the prerequisites required to pay a cash dividend is formal action by the board of directors.

Which of the following is characteristic of deferred income tax payable?

If 50,000 shares are authorized,35,000 shares are issued,and 1,000 shares are reacquired,the number of outstanding shares is 36,000.

The main source of paid-in-capital is from issuing stock.

How is treasury stock shown on the balance sheet?

The liability for a dividend is recorded on which of the following dates?

The primary purpose of a stock split is to reduce the number of shares outstanding in order to encourage more investors to enter the market for the company's shares.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters