Exam 13: Accounting for Corporations

What is a share split? How is it different from a bonus issue or a share dividend?

Shares that have been issued and held by shareholders are _______________ shares.

A corporation issued 300 $5 par value ordinary shares in payment of a $1,800 charge from its accountant for assistance in filing its registration. The entry to record this transaction will include:

The date the directors vote to pay a dividend is called the:

A corporation had the following shares outstanding when the company's board of directors declared a $95,000 cash dividend in the current year: Allocate the cash dividend between the preference and ordinary shareholders assuming the preference shares are noncumulative and nonparticipating.

The following data has been collected about a company's shareholders' equity accounts: Share Capital - Ordinary $10 par value 20,000 shares Authorized and 10,000 shares issued, 1,000 shares in Treasury……………………………………………………… $100,000 Share Premium - Ordinary………………………………………..... 50,000 Retained earnings…………………………………………………… 25,000 Treasury shares……………………………………………………… 11,500 The treasury shares were all purchased at the same price. The cost per share of the treasury shares is:

On September 1, a corporation had 50,000 $5 par value ordinary shares, and $1,000,000 of retained earnings. On that date, when the market price of the share is $15 per share, the corporation issues a 2-for-1 share split. The general journal entry to record this transaction is:

A company has 1,000 $50 par value, 4.5% cumulative and nonparticipating preference shares and 10,000 $10 par value ordinary shares outstanding. The company paid total cash dividends of $1,000 in its first year of operation. The cash dividend that must be paid to preference shareholders in the second year before any dividend is paid to ordinary shareholders is:

Match each of the following terms with the appropriate definitions.

An ordinary share always carries a preference for receiving dividends over a preference share.

If a corporation receives assets other than cash in exchange for shares, it records the assets received at their market value as of the date of the transaction.

When all of the authorized shares have the same rights and characteristics, the share is called

Marble Corporation had the following balances in its shareholders' equity accounts at December 31, 2010: The following transactions occurred during 2011: Based on the above information, prepare a statement of changes in equity for 2011. Use the form below.

Prior period adjustments are reported in the:

A corporation's distribution of additional shares to its shareholders without the receipt of any payment in return is called a:

A company paid $0.75 in cash dividends per share. Its earnings per share is $3.50, and its market price per share is $37.50. Its dividend yield equals:

Retained earnings are not part of the shareholders' claims on the company's net assets.

Book value per ordinary share is calculated by dividing shareholders' equity applicable to ordinary shares by the number of ordinary shares outstanding.

Explain how to compute dividend yield and discuss how it is used in analysis of a company's financial condition.

A participating preference share has a feature that allows it to share with ordinary shareholders in any dividends paid in excess of the percent or dollar amount stated on the preference share.