Exam 12: Income and Changes in Retained Earnings

On January 1, 2011, Ole Corporation had 75,000 shares of $8 par value common stock outstanding. On July 31, 2011, Ole issued an additional 10,000 shares in exchange for a building. What number of shares will be used in the computation of basic earnings per share for the year 2011?

Diluted earnings per share is a hypothetical computation to warn stockholders what could happen if:

The primary purpose of showing special types of events separately in the income statement is to:

Discontinued operations should be shown on the statement of retained earnings net of taxes.

A company had 125,000 shares of common stock outstanding on January 1 and then sold 35,000 additional shares on March 30. Net income for the year was $594,750. What are earnings per share?

A small stock dividend is recorded at:

Colfax Corporation's financial statements for the current year include the following: On the basis of this information, net income for the current year is:

The purpose of developing the subtotals "Income before Extraordinary Items" and "Income from Continuing Operations" in an income statement is to:

Declaration and distribution of a stock dividend cause each of the following effects except:

How many shares of common stock are outstanding?

On January 1, 2009, Carleton Corporation had 55,000 shares of $6 par value common stock outstanding. On March 31, 2009, Carleton issued an additional 10,000 shares in exchange for a building. What number of shares will be used in the computation of basic earnings per share for the year 2009?

Refer to the information above. How many shares of common stock are outstanding?

Unique Corp. had 50,000 shares of $5 preferred stock, $100 par, and 100,000 shares of $1 par common stock outstanding throughout the year. Net income for the year was $780,000, and Unique declared and distributed a cash dividend of $1 per share on its common stock. Earnings per share amounted to:

The amount of cash dividends paid to common stockholders is part of the computation of earnings per share.

Income statement and earnings per share Shown below is information relating to operations of Laconia, Inc., for 2009: In the space provided, complete the income statement for Laconia, Inc., including earnings-per-share figures. Laconia has 100,000 shares of a single class of common stock outstanding throughout the year.

When a stock dividend is declared, total stockholders' equity will:

Special sections in an income statement What is the purpose of arranging an income statement to show subtotals for Income from Continuing Operations and for Income before Extraordinary Items?

Large stock dividends tend to:

Earnings per share-basic and diluted Stainless Corporation had net income of $7,800,000 in 2010. The company had 500,000 shares of $4 par value common stock and 70,000 shares of 8%, $100 par, convertible preferred stock outstanding throughout the year. Each share of preferred stock is convertible into two shares of common stock. Compute the following for 2010:

When a corporation has outstanding both common and preferred stock: