Exam 12: Income and Changes in Retained Earnings

If Caesar Corporation had reacquired 7,000 shares of treasury stock early in 2018,then some treasury stock must have been sold during 2018 for:

How many shares of common stock are outstanding?

Non-recurring items that are unusual and infrequent and the results of discontinued operations are shown in the income statement net of any related income tax effects.

On January 31,Village Bank had 500,000 shares of $3 par value common stock outstanding.On that date,the company declared a 10% stock dividend when the market price of the stock was $62 per share.The immediate effect of this dividend upon Village Bank was:

Earnings per share-basic and diluted Greenwich Corporation had net income of $1,712,500 in 2018.The company had 300,000 shares of $4 par value common stock and 25,000 shares of 8%,$100 par,preferred stock outstanding throughout the year.Each share of preferred stock is both cumulative and convertible.Each share of preferred stock is convertible into four shares of common stock.Compute the following for 2018:

A statement of stockholders' equity is not a required financial statement and need not be prepared along with a statement of retained earnings.

All things being equal,if investors expect earnings to increase substantially from current levels,the price to earnings ratio will:

On January 1,2018,Alice Corporation had 20,000 shares of $6 par value common stock and 10,000 shares of 8%,$100 par value convertible preferred stock outstanding.The preferred shares carried a 3-for-1 conversion privilege.As of December 31,2018,none of the preferred shares had been converted.What number of shares must Alice use in computing diluted earnings per share at December 31,2018?

[The following information applies to the questions displayed below.] The stockholders' equity section of the balance sheet of Caesar Corporation at December 31,2018 appears as follows: (The company engaged in no treasury stock transactions prior to 2018. ) -What was the average issue price per share of preferred stock?

Stock splits are always in a 2-for-1 ratio.

The expropriation (seizure of)of a multinational company's assets by a government is an example of a discontinued operation item.

After preparing the financial statements for 2018,the accountant for the Dawson Corporation discovered that a prior period adjustment had been omitted from the 2015 financial statements.Which of the following is most likely to require correction as a result of this oversight?

Stock dividends and stock splits do not cause a change in the total amount of stockholders' equity.

At the beginning of the current year,Wilson Corporation had 200,000 shares of $1 par common stock outstanding and had retained earnings of $4,800,000.During the year,the company earned $1,675,000 and paid a year-end cash dividend of $3 per share.What was Wilson Corporation's retained earnings at the end of the year?

On January 1,2018,Carleton Corporation had 55,000 shares of $6 par value common stock outstanding.On March 31,2018,Carleton issued an additional 10,000 shares in exchange for a building.What number of shares will be used in the computation of earnings per share for the year 2018?

Which of the following would not be classified as an unusual and/or infrequent item?

In an attempt to appeal to investors,a company may be tempted to overstate net income.

During the year 2018,Tosco Corporation suffered an $800,000 loss when its factory was destroyed in a flood.Assuming the corporate income tax rate is 36%,what amount will Tosco report as a non-recurring loss on its income statement for 2018? Assume floods are not common in this area.

The numerator in calculating earnings per share is reduced for:

Discontinued operations The operations of Global Entertainment,Inc. ,for the current year are summarized below: Global Entertainment had 400,000 shares of capital stock outstanding.Complete the following condensed income statement for the year,including the appropriate earnings per share figures.