Question 1

Dividends in arrears are required to be reported in

Accepted Answer

A) a liability account. 
B) a contra-equity account. 
C) a stockholders' equity account. 
D) the footnotes accompanying the financial statements.

Question 2

Match the following terms to their correct definition.
a.Articles of incorporation
i.Equity
b.Common stock
j.Exercise (strike)price
c.Contributed capital
k.Liquidating dividend
d.Corporate charter
l.No-par stock
e.Current dividend preference
m.Payment date
f.Date of record
n.Preferred stock
g.Declaration date
o.Prior period adjustment
h.Dividends in arrears
p.Return on common equity
-Represents the owners' claims against the assets of a corporation after all liabilities have been deducted.

Accepted Answer

The answer of Match the following terms to their correct...

Question 3

Selected data from the company's financial statements are presented below:
 
-Refer to the information presented above for La Paz Restaurants. The 2015 dividend yield ratio is reported as

Accepted Answer

A) 1.25%. 
B) 1.59%. 
C) 0.057%. 
D) 2.09%.

Question 4

In the space provided, indicate whether the journal entry for the transaction described includes an entry to a stockholders' equity account and if so, whether the account(s)should be debited or credited as a result of the entry.

Accepted Answer

The answer of In the space provided, indicate whether the...

Question 5

Selected data from the company's financial statements are presented below:
 
-Refer to Labor Finders, Inc. The company's 2015 total payout ratio is reported as

Accepted Answer

A) 94.67%. 
B) 105.19%. 
C) 28.00%. 
D) 9.47%.

Question 6

A corporation had several transactions affecting its stockholders' equity accounts during the year. In the space provided, show the impact on the accounting equation by placing a plus sign (+)for an increase, a minus sign (-)for a decrease, or N/A for no impact or no total net impact.

Accepted Answer

The answer of A corporation had several transactions affecting its...

Question 7

On June 1, 2014, the board of directors declared a $100,000 cash dividend to be distributed to common stockholders of record on June 15, 2014. The dividend will be paid on July 1, 2014. The required journal entry on June 1 includes a

Accepted Answer

A) $100,000 debit to retained earnings. 
B) $100,000 debit to dividends payable. 
C) $100,000 credit to cash. 
D) $100,000 credit to common stock.

Question 8

Issued stock that is repurchased by the corporation but not retired is ____________________.

Accepted Answer

The answer of Issued stock that is repurchased by the...

Question 9

Lasik Vision, Inc. began business on June 1, 2014. The corporate charter authorized issuance of 1,000 shares of no-par common stock and 4,000 shares of $6 par, 6% cumulative preferred stock. As of the beginning of 2015, 200 shares of common stock had been issued and none of the preferred stock had been issued. If the company issues 400 shares of common stock on March 1, 2015 for $10 per share, the journal entry would include a

Accepted Answer

A) $4,000 credit to paid-in capital in excess par--common stock. 
B) $4,000 credit to common stock. 
C) $2,400 credit to paid-in capital in excess of par--common stock. 
D) $2,400 credit to common stock.

Question 10

"You Decide" Essay
You are the Chief Financial Officer of Laser Craft Technology. Your company needs to raise capital to pursue an expansion project, but the company does not want to sell additional common stock. What factors should you consider in deciding whether to issue debt or preferred stock?

Accepted Answer

The answer of "You Decide" Essay
You are the Chief Financial...

Question 11

Selected data from the company's financial statements are presented below:
 
-Refer to Labor Finders, Inc. The company's 2015 stock repurchase payout ratio is reported as

Accepted Answer

A) 6.67%. 
B) 77.19%. 
C) 28.00%. 
D) 66.67%.

Question 12

Information from the stockholders' equity section of the balance sheet at December 31, 2014, is provided below:
  This company has been in business for over ten years, but has paid no dividends for the past two years, 2013 and 2014 due to a temporary decline in business. During the current year, 2015, the company has net income of $30,000 and plans to pay a dividend. Complete the table below indicating the amount of dividends that each class of stockholder will receive under the following preferred stock dividend assumptions:

Accepted Answer

The answer of Information from the stockholders' equity section of...

Question 13

The following information is available at January 1, 2015:
  On June 10, the company repurchased and retired 1,000 shares of its outstanding common stock for $10 per share. Record this transaction.

Accepted Answer

The answer of The following information is available at January...

Question 14

The __________________ dividend preference is a preferred stock feature that provides for the current stated dividends plus dividends in arrears before any dividends are paid to the common stockholders.

Accepted Answer

The answer of The __________________ dividend preference is a preferred...

Question 15

The equity section of a balance sheet at December 31, 2014, is presented below:
  On May 15, 2015, the company reacquired 1,000 shares of its common stock at $15 per share. Then on July 1, 2015, 500 shares of treasury stock were sold for $20 per share.

Accepted Answer

The answer of The equity section of a balance sheet...

Question 16

When a corporation is in the process of being dissolved, any additional dividends are referred to as ____________________ dividends.

Accepted Answer

The answer of When a corporation is in the process...

Question 17

Compare and contrast stock dividends and stock splits.

Accepted Answer

The answer of Compare and contrast stock dividends and stock...

Question 18

Refer to Lanthier's Heating & Air. On June 5, 2014, the company issued 2,400 shares of common stock for $20 per share. What effect does the entry to record the stock issuance have on total stockholders' equity?

Accepted Answer

A) increase of $4,800 
B) decrease of $4,800 
C) increase of $48,000 
D) decrease of $48,000

Question 19

MATCHING
-The preferred stock feature which provides for the sharing of dividends above the stated amount.

Accepted Answer

The answer of MATCHING
-The preferred stock feature which provides for...

Question 20

Selected data from the company's financial statements are presented below:
 
-Refer to Labor Finders, Inc. The company's 2015 return on common equity is reported as

Accepted Answer

A) 7.58%. 
B) 7.90%. 
C) 8.43%. 
D) 8.78%.

Exam 10: Stockholders Equity

Dividends in arrears are required to be reported in

Selected data from the company's financial statements are presented below: -Refer to the information presented above for La Paz Restaurants. The 2015 dividend yield ratio is reported as

In the space provided, indicate whether the journal entry for the transaction described includes an entry to a stockholders' equity account and if so, whether the account(s)should be debited or credited as a result of the entry.

Selected data from the company's financial statements are presented below: -Refer to Labor Finders, Inc. The company's 2015 total payout ratio is reported as

A corporation had several transactions affecting its stockholders' equity accounts during the year. In the space provided, show the impact on the accounting equation by placing a plus sign (+)for an increase, a minus sign (-)for a decrease, or N/A for no impact or no total net impact.

On June 1, 2014, the board of directors declared a $100,000 cash dividend to be distributed to common stockholders of record on June 15, 2014. The dividend will be paid on July 1, 2014. The required journal entry on June 1 includes a

Issued stock that is repurchased by the corporation but not retired is ____________________.

"You Decide" Essay You are the Chief Financial Officer of Laser Craft Technology. Your company needs to raise capital to pursue an expansion project, but the company does not want to sell additional common stock. What factors should you consider in deciding whether to issue debt or preferred stock?

Selected data from the company's financial statements are presented below: -Refer to Labor Finders, Inc. The company's 2015 stock repurchase payout ratio is reported as

The following information is available at January 1, 2015: On June 10, the company repurchased and retired 1,000 shares of its outstanding common stock for $10 per share. Record this transaction.

The __________________ dividend preference is a preferred stock feature that provides for the current stated dividends plus dividends in arrears before any dividends are paid to the common stockholders.

The equity section of a balance sheet at December 31, 2014, is presented below: On May 15, 2015, the company reacquired 1,000 shares of its common stock at $15 per share. Then on July 1, 2015, 500 shares of treasury stock were sold for $20 per share.

When a corporation is in the process of being dissolved, any additional dividends are referred to as ____________________ dividends.

Compare and contrast stock dividends and stock splits.

Refer to Lanthier's Heating & Air. On June 5, 2014, the company issued 2,400 shares of common stock for $20 per share. What effect does the entry to record the stock issuance have on total stockholders' equity?

MATCHING -The preferred stock feature which provides for the sharing of dividends above the stated amount.

Selected data from the company's financial statements are presented below: -Refer to Labor Finders, Inc. The company's 2015 return on common equity is reported as