Exam 13: Accounting for Corporations

Firehawk Corporation had net income of $560,000 in 20x5 and paid dividends of $440,000 on 200,000 shares of outstanding common stock.Total stockholders' equity at the end of 20x5 was $2,060,000 and the market price for each share of Firehawk's stock was $58 throughout 20x5.Additionally,the company paid preferred dividends of $2.40 per share during 20x5.Based on this information,what is the dividend yield on Firehawk's stock?

The board of directors of Meadow Corporation declared a cash dividend on January 18,20x5 ,to be paid on February 18,20x5 ,to shareholders holding the stock on February 2,20x5 .Given these facts,the date February 2,20x5 ,is referred to as the

The sale of shares in a corporation by one stockholder to another does not affect the total capital of the corporation.

Outstanding shares of stock are

Which of the following is the appropriate entry to record the declaration of cash dividends?

The board of directors of Lark Corporation declared a cash dividend of $3.50 per share on 57,000 shares of common stock on June 14,20x5.The dividend is to be paid on July 15,20x5,to shareholders of record on July 1,20x5.The proper entry to be recorded on July 15,20x5 is,

Use the following information to obtain the ratios requested below.Where necessary,carry answers to one decimal place. Dividends per share: $2.16 Market price per share: $48 Net income: $88,000 Average stockholders' equity: $625,000 Earnings per share: $1.56 a.Dividends yield = _____________% b.Return on equity = _____________% c.Price/earnings (P/E)ratio = __________times

Mariposa Corporation had a Retained Earnings balance on January 1,20x4,of $936,000;declared cash dividends during 20x4 in the amount of $159,900,of which $39,000 were not paid until 20x5;and reported an ending balance of Retained Earnings of $1,326,000.Based on these facts alone,net income for 20x4 for Mariposa Corporation must have been

The number of outstanding shares should exceed the number of authorized shares.

The preparation of a statement of stockholders' equity makes which other financial statement unnecessary?

The information that follows pertains to stockholders' equity data of Frame Corporation on December 31,20x5.Compute the amount of each item indicated by a letter in the listing below.

The board of directors of Lark Corporation declared a cash dividend of $3.50 per share on 57,000 shares of common stock on June 14,20x5.The dividend is to be paid on July 15,20x5,to shareholders of record on July 1,20x5.The effects of the entry to record the declaration of the dividend on June 14,20x5,are to

Which of the following statements is descriptive of common stock?

The entry to close the Dividends account at the end of an accounting period which has a balance of $10,000 is:

Willow Corporation has retained earnings of $320,000.It has 5,000 shares of 6 percent,$100 par value preferred stock outstanding that is callable at 102.The preferred stock is cumulative,and one year of dividends is in arrears.It also has 10,000 shares of $50 par value common stock outstanding.Assume all stock is issued at par.The book value of each share of preferred stock is

The stockholders' equity in a corporation consists of capital contributed by stockholders and retained earnings.

The effects on individual contributed capital accounts of a conversion of preferred stock to common stock during the period are disclosed on the statement of stockholders' equity.

A corporation has all of the following except

Receiving dividends is the only way in which stockholders can earn a return on their investment in a corporation.

The contributed capital of a corporation does not include