Exam 21: Corporate Earnings and Capital Transactions

In each of the following situations, what is the amount of profit or loss? In each situation, what account will be debited and credited, and for what amount, in the journal entry to close the Income Summary account? 1. The total of the debit column in the Income Statement section of the worksheet was $84,000 and the total of the credit column in that section was $74,000. 2. The total in the debit column of the Income Statement section was $600,000 and the total of the credit column was $700,000. 3. The total of the debit column in the Balance Sheet section was $90,000 and the total of the credit column in that section was $82,000.

The Intrepid Corporation is authorized to issue 10,000 shares of 6 percent, $100 par-value preferred stock and 50,000 shares of $2 par-value common stock On December 31, 2013, 1,000 shares of preferred stock and 20,000 shares of common stock are issued and outstanding. The corporation's transactions affecting stockholders' equity during 2014 are given below. Record the transactions on page 8 of a general journal. Omit descriptions.

A corporation reported a net income of $120,000 for its fiscal year and declared and paid cash dividends of $60,000. A stock dividend recorded at $40,000 was also distributed during the year. If the ending balance of the Retained Earnings account was $200,000, the beginning balance is

Which of the following statements is not correct?

The Dividends Payable accounts appear on the balance sheet as a current liability.

A corporation reported a net income of $120,000 for its fiscal year and declared and paid cash dividends of $50,000. A stock dividend recorded at $80,000 was also distributed during the year. If the beginning balance of the Retained Earnings account was $200,000, the ending balance is

The last closing entry for a corporation transfers the net income after income taxes from the Income Summary account to Retained Earnings.

Accumulated profits kept in the business and not distributed as dividends to stockholders are called ___________________.

The following information was taken from the accounting records of the Goodens Corporation on December 31, 2013. Using this information, prepare the Stockholders' Equity section of the corporation's balance sheet.

The following information was taken from the accounting records of the Arens Corporation on December 31, 2013. Using this information, prepare the Stockholders' Equity section of the corporation's balance sheet.

The Dever Corporation is authorized to issue 3,000 shares of 8 percent, $50 par-value preferred stock and 10,000 shares of no-par-value common stock with a stated value of $20 per share. On December 31, 2013, 1,000 shares of preferred stock and 4,000 shares of common stock are issued and outstanding. The corporation's transactions affecting stockholders' equity during 2014 are given below. Record the transactions on page 8 of a general journal. Omit descriptions.

When a corporation reacquires stock that it previously issued and intends to reissue at a later date, the ____________________ account is debited.

When a corporation reacquires its own shares of stock, the Treasury Stock account is usually debited for

Which of the following statements is not correct?

A declaration and distribution of a 20 percent stock dividend on common stock will

A corporation has paid estimated income taxes of $80,000 during the year 2013. At the end of the year, the corporation's tax bill is computed to be $100,000. Record the entry to adjust the Income Tax Expense account on page 6 of a general journal. Omit the description.

The record date is the date

Which of the following statements regarding the income statements of corporations is not correct?

A corporation reacquired 400 shares of its $100 par-value common stock for $105 a share. The entry to record this transaction includes a

Property that is received as a gift should be recorded in the corporation's records at the asset's fair market value.