Exam 11: Reporting and Analyzing Stockholders Equity

Use the following information for questions Air Ace Corporation issues 5,000 preferred shares for $40 per share. -The entry to record the transaction will consist of a debit to Cash for $200,000 and a credit or credits to

Stock Dividends Distributable is classified as a(n)

Stock Dividends Distributable is reported as a liability on the statement of financial position.

If the board of directors authorizes a $250,000 restriction of retained earnings for a future plant expansion, the effect of this action is to

In the shareholders' equity section of the statement of financial position,

Retained earnings are occasionally restricted

Investors tend to buy shares with low payout ratios and dividend yields if they are looking for more capital appreciation from the shares.

Diluted earnings per share

Preferred shares are generally issued to appeal to a larger segment of potential investors.

Dividends in arrears are dividends on

Use the following information for questions Air Ace Corporation issues 5,000 preferred shares for $40 per share. -In the statement of financial position, the effects of the above transaction will be reported under

Companies reporting under ASPE must disclose earnings per share, but companies reporting under IFRS do not.

Shareholders directly elect the corporation's

Use the following information for questions On July 15, 2015, the board of directors of George Easton Limited declared a cash dividend of $0.50 per share on 84,000 common shares.The dividend is to be paid on August 15, 2015, to shareholders of record on July 31, 2015. -The journal entry to be recorded on July 15, 2015, will include a

If the statement of financial position is prepared after a stock dividend has been declared but before it has been distributed, the stock dividend distributable would be reported in the

The issue of common shares affects both share capital and retained earnings.

Use the following information for questions On January 1, Brunhilde Corporation had 240,000 common shares issued.On March 17, the company declared a 5% stock dividend to be distributed on March 30.The market value of the shares was $9 on March 17 and $12 on March 30. -The entry to record the transaction of March 30 would include a

All of the following are normally found in a publicly-traded corporation's shareholders' equity section except

Indicate how shareholders' equity is presented in the financial statements.

Which of the following statements is considered an advantage of the corporate form of organization?