Question 1

If treasury stock is sold at a price greater than its reacquisition cost,the difference is:

Accepted Answer

A) debited to Paid-in Capital from Treasury Stock Transactions. 
B) credited to Paid-in Capital from Treasury Stock Transactions. 
C) debited to Retained Earnings. 
D) credited to Retained Earnings. 
A) debited to Paid-in Capital from Treasury Stock Transactions. 
B) credited to Paid-in Capital from Treasury Stock Transactions. 
C) debited to Retained Earnings. 
D) credited to Retained Earnings.

Question 2

U.S.GAAP prohibits companies from supplementing employee salaries by granting shares of stock rather than cash.

Accepted Answer

A) True 
 B)False

Question 3

A new corporation forms every time there is a change in ownership in the shares of common stock.

Accepted Answer

A) True 
 B)False

Question 4

Retired stock can be reissued.

Accepted Answer

A) True 
 B)False

Question 5

Marvin Corporation has the following information reported on the balance sheet as of December 31 of the current year:   Based on the information above,how many shares of common stock are outstanding?

Accepted Answer

A) 20,000 
B) 5000 
C) 3000 
D) 2000 
A) 20,000 
B) 5000 
C) 3000 
D) 2000

Question 6

During the month of February,B & B Builders,Inc.completed the following transactions related to its stock:
   Required:
Prepare journal entries for the above transactions.Omit explanations.

Accepted Answer

The answer of During the month of February,B & B...

Question 7

Double taxation means that the:

Accepted Answer

A) corporation's income tax is allocated to the shareholders based on ownership percentage. 
B) corporate earnings are subject to state and federal income tax. 
C) corporation pays taxes on its earnings and the shareholders pay taxes on the dividends received from the corporation. 
D) shareholders' dividends are taxed at the corporate tax rate. 
A) corporation's income tax is allocated to the shareholders based on ownership percentage. 
B) corporate earnings are subject to state and federal income tax. 
C) corporation pays taxes on its earnings and the shareholders pay taxes on the dividends received from the corporation. 
D) shareholders' dividends are taxed at the corporate tax rate.

Question 8

In general,the order of reporting stockholders' equity on the balance sheet is:

Accepted Answer

A) Common Stock,Preferred Stock,Paid-in Capital in Excess of Par,Retained Earnings,Treasury Stock. 
B) Preferred Stock,Common Stock,Treasury Stock,Paid-in Capital in Excess of Par,Retained Earnings. 
C) Preferred Stock,Common Stock,Paid-in Capital in Excess of Par,Retained Earnings,Treasury Stock. 
D) Retained Earnings,Preferred Stock,Common Stock,Paid-in Capital in Excess of Par,Treasury Stock. 
A) Common Stock,Preferred Stock,Paid-in Capital in Excess of Par,Retained Earnings,Treasury Stock. 
B) Preferred Stock,Common Stock,Treasury Stock,Paid-in Capital in Excess of Par,Retained Earnings. 
C) Preferred Stock,Common Stock,Paid-in Capital in Excess of Par,Retained Earnings,Treasury Stock. 
D) Retained Earnings,Preferred Stock,Common Stock,Paid-in Capital in Excess of Par,Treasury Stock.

Question 9

Dolanski Company declares and distributes a 30% common stock dividend when it has 60,000 shares of $10 par common stock outstanding.The market price per share is $75 at the date of declaration.Which journal entry is prepared?

Accepted Answer

A) debit Retained Earnings $1,350,000,credit Common Stock $180,000 and credit Paid-in Capital in Excess of Par-Common $1,170,000 
B) debit Retained Earnings $1,350,000,credit Paid-in Capital in Excess of Par-Common $500,000 
C) debit Retained Earnings $1,350,000 and credit Common Stock $1,350,000 
D) debit Retained Earnings $180,000 and credit Common Stock $180,000 
A) debit Retained Earnings $1,350,000,credit Common Stock $180,000 and credit Paid-in Capital in Excess of Par-Common $1,170,000 
B) debit Retained Earnings $1,350,000,credit Paid-in Capital in Excess of Par-Common $500,000 
C) debit Retained Earnings $1,350,000 and credit Common Stock $1,350,000 
D) debit Retained Earnings $180,000 and credit Common Stock $180,000

Question 10

The purchase of treasury stock decreases the number of shares outstanding.

Accepted Answer

A) True 
 B)False

Question 11

Gruber Law Offices paid $57,000 to buy back 12,000 shares of its $1 par value common stock.The stock was sold later at a selling price of $13 per share.The journal entry to record the sale would include a: (Do not round intermediate calculations. )

Accepted Answer

A) credit to Paid-in Capital from Treasury Stock Transactions $57,000. 
B) debit to Common Stock $57,000. 
C) credit to Paid-in Capital from Treasury Stock Transactions $99,000. 
D) credit to Common Stock $99,000. 
A) credit to Paid-in Capital from Treasury Stock Transactions $57,000. 
B) debit to Common Stock $57,000. 
C) credit to Paid-in Capital from Treasury Stock Transactions $99,000. 
D) credit to Common Stock $99,000.

Question 12

If stock is issued for an asset other than cash,the asset should be recorded on the books of the corporation at the:

Accepted Answer

A) current market value of the asset. 
B) book value of the asset. 
C) par value of the stock. 
D) fair market value of the stock minus the par value of the stock. 
A) current market value of the asset. 
B) book value of the asset. 
C) par value of the stock. 
D) fair market value of the stock minus the par value of the stock.

Question 13

A corporation is an entity that is not separate from its owners.

Accepted Answer

A) True 
 B)False

Question 14

Bloom Corporation issued 60,000 shares of common stock.Bloom purchased 9000 shares and later reissued 900 shares.How many shares are issued and outstanding?

Accepted Answer

A) 51,000 issued and 51,000 outstanding 
B) 60,000 issued and 51,000 outstanding 
C) 51,900 issued and 51,900 outstanding 
D) 60,000 issued and 51,900 outstanding 
A) 51,000 issued and 51,000 outstanding 
B) 60,000 issued and 51,000 outstanding 
C) 51,900 issued and 51,900 outstanding 
D) 60,000 issued and 51,900 outstanding

Question 15

When a corporation issues stock and receives an asset other than cash,the value of the asset received can create an ethical challenge.

Accepted Answer

A) True 
 B)False

Question 16

A company has 400,000 shares issued and outstanding of $1 par common stock.After a 2-for-1 stock split,which of the following statements is FALSE?

Accepted Answer

A) The par value per share decreases to $0.50 per share. 
B) The number of shares issued is 800,000. 
C) The number of shares outstanding is 800,000. 
D) The number of shares issued is 200,000. 
A) The par value per share decreases to $0.50 per share. 
B) The number of shares issued is 800,000. 
C) The number of shares outstanding is 800,000. 
D) The number of shares issued is 200,000.

Question 17

Peter's Computers purchased 1000 shares of its own $3 par value common stock for $92,000.As a result of this transaction:

Accepted Answer

A) Peter's stockholders' equity increased $89,000. 
B) Peter's stockholders' equity increased $3000. 
C) Peter's stockholders' equity decreased $92,000. 
D) Peter's stockholders' equity increased $92,000. 
A) Peter's stockholders' equity increased $89,000. 
B) Peter's stockholders' equity increased $3000. 
C) Peter's stockholders' equity decreased $92,000. 
D) Peter's stockholders' equity increased $92,000.

Question 18

Lisa Laskowski Company reports the following information at the current fiscal year end of December 31:   What was the average selling price for the common stock issued? (Round your final answer to the nearest cent. )

Accepted Answer

A) $0.61 per share 
B) $0.10 per share 
C) $0.71 per share 
D) $0.92 per share 
A) $0.61 per share 
B) $0.10 per share 
C) $0.71 per share 
D) $0.92 per share

Question 19

Lewandowski Company reports the following information at the current fiscal year end of December 31:   What is the total paid-in capital for this company at December 31 of the current year?

Accepted Answer

A) $98 million 
B) $298 million 
C) $898 million 
D) $1098 million 
A) $98 million 
B) $298 million 
C) $898 million 
D) $1098 million

Question 20

What is the formula for the price-earnings ratio? What does this ratio measure?

Accepted Answer

Price-earnings ratio = Market

If treasury stock is sold at a price greater than its reacquisition cost,the difference is:

U.S.GAAP prohibits companies from supplementing employee salaries by granting shares of stock rather than cash.

A new corporation forms every time there is a change in ownership in the shares of common stock.

Retired stock can be reissued.

Marvin Corporation has the following information reported on the balance sheet as of December 31 of the current year: Based on the information above,how many shares of common stock are outstanding?

During the month of February,B & B Builders,Inc.completed the following transactions related to its stock: Required: Prepare journal entries for the above transactions.Omit explanations.

Double taxation means that the:

In general,the order of reporting stockholders' equity on the balance sheet is:

Dolanski Company declares and distributes a 30% common stock dividend when it has 60,000 shares of $10 par common stock outstanding.The market price per share is $75 at the date of declaration.Which journal entry is prepared?

The purchase of treasury stock decreases the number of shares outstanding.

Gruber Law Offices paid $57,000 to buy back 12,000 shares of its $1 par value common stock.The stock was sold later at a selling price of $13 per share.The journal entry to record the sale would include a: (Do not round intermediate calculations. )

If stock is issued for an asset other than cash,the asset should be recorded on the books of the corporation at the:

A corporation is an entity that is not separate from its owners.

Bloom Corporation issued 60,000 shares of common stock.Bloom purchased 9000 shares and later reissued 900 shares.How many shares are issued and outstanding?

When a corporation issues stock and receives an asset other than cash,the value of the asset received can create an ethical challenge.

A company has 400,000 shares issued and outstanding of $1 par common stock.After a 2-for-1 stock split,which of the following statements is FALSE?

Peter's Computers purchased 1000 shares of its own $3 par value common stock for $92,000.As a result of this transaction:

Lisa Laskowski Company reports the following information at the current fiscal year end of December 31: What was the average selling price for the common stock issued? (Round your final answer to the nearest cent. )

Lewandowski Company reports the following information at the current fiscal year end of December 31: What is the total paid-in capital for this company at December 31 of the current year?

What is the formula for the price-earnings ratio? What does this ratio measure?

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 10: Stockholders Equity

If treasury stock is sold at a price greater than its reacquisition cost,the difference is:

U.S.GAAP prohibits companies from supplementing employee salaries by granting shares of stock rather than cash.

A new corporation forms every time there is a change in ownership in the shares of common stock.

Retired stock can be reissued.

Marvin Corporation has the following information reported on the balance sheet as of December 31 of the current year: Based on the information above,how many shares of common stock are outstanding?

During the month of February,B & B Builders,Inc.completed the following transactions related to its stock: Required: Prepare journal entries for the above transactions.Omit explanations.

Double taxation means that the:

In general,the order of reporting stockholders' equity on the balance sheet is:

Dolanski Company declares and distributes a 30% common stock dividend when it has 60,000 shares of $10 par common stock outstanding.The market price per share is $75 at the date of declaration.Which journal entry is prepared?

The purchase of treasury stock decreases the number of shares outstanding.

Gruber Law Offices paid $57,000 to buy back 12,000 shares of its $1 par value common stock.The stock was sold later at a selling price of $13 per share.The journal entry to record the sale would include a: (Do not round intermediate calculations. )

If stock is issued for an asset other than cash,the asset should be recorded on the books of the corporation at the:

A corporation is an entity that is not separate from its owners.

Bloom Corporation issued 60,000 shares of common stock.Bloom purchased 9000 shares and later reissued 900 shares.How many shares are issued and outstanding?

When a corporation issues stock and receives an asset other than cash,the value of the asset received can create an ethical challenge.

A company has 400,000 shares issued and outstanding of $1 par common stock.After a 2-for-1 stock split,which of the following statements is FALSE?

Peter's Computers purchased 1000 shares of its own $3 par value common stock for $92,000.As a result of this transaction:

Lisa Laskowski Company reports the following information at the current fiscal year end of December 31: What was the average selling price for the common stock issued? (Round your final answer to the nearest cent. )

Lewandowski Company reports the following information at the current fiscal year end of December 31: What is the total paid-in capital for this company at December 31 of the current year?

What is the formula for the price-earnings ratio? What does this ratio measure?

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters