Question 1

The book value per share for a corporation is

Accepted Answer

A) the market price of the stock. 
B) the cost of investments in stock of other corporations. 
C) based on the excess of total assets over total liabilities. 
D) the amount stockholders would receive if they sold their shares back to the corporation. 
A) the market price of the stock. 
B) the cost of investments in stock of other corporations. 
C) based on the excess of total assets over total liabilities. 
D) the amount stockholders would receive if they sold their shares back to the corporation. C

Question 2

Which of the following is reported as a financing activity?

Accepted Answer

A) Declaration of dividends. 
B) Sale of preferred stock. 
C) Conversion of preferred stock to common stock. 
D) Stock split. 
A) Declaration of dividends. 
B) Sale of preferred stock. 
C) Conversion of preferred stock to common stock. 
D) Stock split. B

Question 3

Select the best answer from the list below to complete statements 1-11 that follow.
   The number of shares sold or distributed to stockholder are ____________________________.

Accepted Answer

issued shares

Question 4

When a company wishes to purchase and retire its own stock,the company must

Accepted Answer

A) decrease the stock account balances by the original issue price. 
B) record a gain or loss depending on the difference between original selling price and repurchase cost. 
C) get the approval of the state to do so. 
D) issue a different class of stock to the former stockholders. 
A) decrease the stock account balances by the original issue price. 
B) record a gain or loss depending on the difference between original selling price and repurchase cost. 
C) get the approval of the state to do so. 
D) issue a different class of stock to the former stockholders.

Question 5

When a company purchases treasury stock,which of the following statements is true?

Accepted Answer

A) Treasury stock is considered to be an asset because cash is paid for the stock. 
B) The cost of the treasury stock reduces stockholders' equity. 
C) Dividends continue to be paid on the treasury stock because it is still issued. 
D) Since treasury stock is held by the original issuer,it is no longer considered to be issued. 
A) Treasury stock is considered to be an asset because cash is paid for the stock. 
B) The cost of the treasury stock reduces stockholders' equity. 
C) Dividends continue to be paid on the treasury stock because it is still issued. 
D) Since treasury stock is held by the original issuer,it is no longer considered to be issued.

Question 6

All of the following are reasons for a company to repurchase its previously issued stock,except:

Accepted Answer

A) to support the market price of the stock 
B) to resell to employees 
C) to increase the shares outstanding 
D) for bonuses to employees 
A) to support the market price of the stock 
B) to resell to employees 
C) to increase the shares outstanding 
D) for bonuses to employees

Question 7

What is substance over form and how does this concept relate to the presentation of preferred stock?

Accepted Answer

Substance over form means that a company

Question 8

A company may prepare a statement of retained earnings instead of a statement of stockholders' equity if the only changes in the stockholders' equity accounts that occurred during the year are earnings and dividends.

Accepted Answer

A) True 
 B)False

Question 9

If a company purchases treasury stock for $6,000 and then reissues it for $5,000,the difference of $1,000 is

Accepted Answer

A) treated as a gain on the sale. 
B) treated as a loss on the sale. 
C) an increase in stockholders' equity. 
D) a decrease in stockholders' equity. 
A) treated as a gain on the sale. 
B) treated as a loss on the sale. 
C) an increase in stockholders' equity. 
D) a decrease in stockholders' equity.

Question 10

The Stockholders' Equity section of Snack,Inc.'s balance sheet on January 1,2012,appeared as follows:   On March 1,2012,Snack reacquired 4,000 shares of common stock at $50 per share.All common shares were originally sold for $42 each.How much should be reported in the treasury stock account on the March 31,2012 balance sheet?

Accepted Answer

A) $ 128,000 
B) $ 168,000 
C) $ 200,000 
D) $ 32,000 
A) $ 128,000 
B) $ 168,000 
C) $ 200,000 
D) $ 32,000

Question 11

Preferred stock receives first preference on voting rights.

Accepted Answer

A) True 
 B)False

Question 12

The selling price of the stock as indicated by the most recent stock transaction is ___________________________________.

Accepted Answer

market val

Question 13

A company would repurchase its own stock for all of the following reasons except

Accepted Answer

A) it needs the stock for employee bonuses. 
B) it wishes to make an investment in its own stock. 
C) it wishes to prevent unwanted takeover attempts. 
D) it wishes to improve the company's financial ratios. 
A) it needs the stock for employee bonuses. 
B) it wishes to make an investment in its own stock. 
C) it wishes to prevent unwanted takeover attempts. 
D) it wishes to improve the company's financial ratios.

Question 14

Dali Company has 15,000 shares of stock authorized at January 1.Dali issues 4,500 shares to the stockholders during the year and then the company repurchases 1,500 shares as treasury stock.Based on this information,how many shares are outstanding at December 31?

Accepted Answer

A) 15,000 
B) 18,000 
C) 4,500 
D) 3,000 
A) 15,000 
B) 18,000 
C) 4,500 
D) 3,000

Question 15

Treasury stock is reported as a reduction in stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 16

What is treasury stock? How is it reported on the financial statements?

Accepted Answer

Treasury stock is issued stock

Question 17

[APPENDIX] Tony Venato opened Tony's Best Brand Shop as a sole proprietorship by investing $10,000 on January 1,2012.During the first year,the business earned revenues of $520,000 and incurred expenses of $360,000.Tony withdrew $50,000 for personal use.Prepare Tony's statement of owner's equity for the year ended December 31,2012.

Accepted Answer

Tony's Best Brand Sh

Question 18

What is comprehensive income and what is contained in a statement of comprehensive income?

Accepted Answer

Comprehensive income is the total change

Question 19

A new company issues 2,000 shares of $5 par common stock in exchange for the services of a lawyer during its first month of business.The lawyer's normal fee is $15,000 for similar work.Which of the following would be recorded if the stock is not currently trading?

Accepted Answer

A) A debit to Common Stock for $10,000 
B) A credit to Common Stock for $15,000 
C) A debit to Additional Paid-In Capital--Common Stock of $5,000 
D) A credit to Additional Paid-In Capital--Common Stock of $5,000 
A) A debit to Common Stock for $10,000 
B) A credit to Common Stock for $15,000 
C) A debit to Additional Paid-In Capital--Common Stock of $5,000 
D) A credit to Additional Paid-In Capital--Common Stock of $5,000

Question 20

The primary reason for a stock split is to

Accepted Answer

A) distribute cash to the investor. 
B) decrease the market value of the stock. 
C) decrease the number of shares outstanding. 
D) increase the contributed capital of the corporation. 
A) distribute cash to the investor. 
B) decrease the market value of the stock. 
C) decrease the number of shares outstanding. 
D) increase the contributed capital of the corporation.

The book value per share for a corporation is

Which of the following is reported as a financing activity?

Select the best answer from the list below to complete statements 1-11 that follow. The number of shares sold or distributed to stockholder are ____________________________.

When a company wishes to purchase and retire its own stock,the company must

When a company purchases treasury stock,which of the following statements is true?

All of the following are reasons for a company to repurchase its previously issued stock,except:

What is substance over form and how does this concept relate to the presentation of preferred stock?

A company may prepare a statement of retained earnings instead of a statement of stockholders' equity if the only changes in the stockholders' equity accounts that occurred during the year are earnings and dividends.

If a company purchases treasury stock for $6,000 and then reissues it for $5,000,the difference of $1,000 is

Preferred stock receives first preference on voting rights.

The selling price of the stock as indicated by the most recent stock transaction is ___________________________________.

A company would repurchase its own stock for all of the following reasons except

Dali Company has 15,000 shares of stock authorized at January 1.Dali issues 4,500 shares to the stockholders during the year and then the company repurchases 1,500 shares as treasury stock.Based on this information,how many shares are outstanding at December 31?

Treasury stock is reported as a reduction in stockholders' equity.

What is treasury stock? How is it reported on the financial statements?

What is comprehensive income and what is contained in a statement of comprehensive income?

A new company issues 2,000 shares of $5 par common stock in exchange for the services of a lawyer during its first month of business.The lawyer's normal fee is $15,000 for similar work.Which of the following would be recorded if the stock is not currently trading?

The primary reason for a stock split is to

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

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Exam 11: Stockholders Equity

The book value per share for a corporation is

Which of the following is reported as a financing activity?

Select the best answer from the list below to complete statements 1-11 that follow. The number of shares sold or distributed to stockholder are ____________________________.

When a company wishes to purchase and retire its own stock,the company must

When a company purchases treasury stock,which of the following statements is true?

All of the following are reasons for a company to repurchase its previously issued stock,except:

What is substance over form and how does this concept relate to the presentation of preferred stock?

A company may prepare a statement of retained earnings instead of a statement of stockholders' equity if the only changes in the stockholders' equity accounts that occurred during the year are earnings and dividends.

If a company purchases treasury stock for $6,000 and then reissues it for $5,000,the difference of $1,000 is

Preferred stock receives first preference on voting rights.

The selling price of the stock as indicated by the most recent stock transaction is ___________________________________.

A company would repurchase its own stock for all of the following reasons except

Dali Company has 15,000 shares of stock authorized at January 1.Dali issues 4,500 shares to the stockholders during the year and then the company repurchases 1,500 shares as treasury stock.Based on this information,how many shares are outstanding at December 31?

Treasury stock is reported as a reduction in stockholders' equity.

What is treasury stock? How is it reported on the financial statements?

What is comprehensive income and what is contained in a statement of comprehensive income?

A new company issues 2,000 shares of $5 par common stock in exchange for the services of a lawyer during its first month of business.The lawyer's normal fee is $15,000 for similar work.Which of the following would be recorded if the stock is not currently trading?

The primary reason for a stock split is to

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters