Exam 11: Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Start Inc. has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2015. What is the annual dividend on the preferred stock?

Stock dividends and stock splits have the following effects on retained earnings: Stock Splits Stock Dividends a. Increase No change b. No change Decrease c. Decrease Decrease d. No change No change

If common stock is issued for an amount greater than par value, the excess should be credited to

A corporation can issue more shares than it is authorized in its charter, if the board of directors approves of an increase in the number of authorized shares.

A factor which distinguishes the corporate form of organization from a sole proprietorship or partnership is that a

A stockholder who receives a stock dividend would

IFRS treats the purchase of treasury stock as any of the following except

The board of directors must assign a per share value to a stock dividend declared that is

The purchase of treasury stock

Under IFRS, equity is described as each of the following except

Rouse Corporation's December 31, 2015 balance sheet showed the following: 8% preferred stock, $10 par value, cumulative, 20,000 shares authorized; 15,000 shares issued \ 150,000 Common stock, \1 0 par value, 2,000,000 shares authorized; 1,950,000 shares issued, 1,930,000 shares outstanding 19,500,000 Paid-in capital in excess of par-preferred stock 60,000 Paid-in capital in excess of par-common stock 24,000,000 Retained earnings 7,650,000 Treasury stock (20,000 shares) 630,000 Rouse's total stockholders' equity was

The acquisition of treasury stock by a corporation

The effect of the declaration of a cash dividend by the board of directors is to A) Stockholders' equity Assets B) Assets Liabilities C) Liabilities Stockholders' equity D) Liabilities Assets

The numerator of the return on common stockholders' equity is

A stock split

Prior period adjustments are reported

When no-par value stock does not have a stated value, the entire proceeds from the issuance of the stock becomes legal capital.

A corporation is not an entity which is separate and distinct from its owners.

Dillon Corporation splits its common stock 2 for 1, when the market value is $40 per share. Prior to the split, Dillon had 50,000 shares of $10 par value common stock issued and outstanding. After the split, the par value of the stock

Legal capital per share cannot be equal to the