Exam 13: Corporations: Organization, Stock Transactions, and Dividends

Marcos Company, which had 35,000 shares of common stock outstanding, declared a 4-for-1 stock split.​Required (a)What will be the number of shares outstanding after the split? (b)If the common stock had a market price of $280 per share before the stock split, what would be an approximate market price per share after the split?

If paid-in capital in excess of par/preferred stock is $30,000, preferred stock is $200,000, paid-in capital in excess of par/common stock is $20,000, common stock is $525,000, and retained earnings is $105,000 (deficit), total stockholders' equity is $880,000.

The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 40,000 shares were originally issued and 10,000 were subsequently reacquired. What is the number of shares outstanding?

A deficit in Retained Earnings is reported in the Stockholders' equity section of the balance sheet.

Match each of the following stockholders' equity concepts to the appropriate term (a-h). -The date when dividends are actually distributed to stockholders

Cash dividends become a liability to a corporation on the date of record.

When a corporation completes a 3-for-1 stock split,

Under the Internal Revenue Code, corporations are required to pay federal income taxes.

Match each of the following stockholders' equity concepts to the most appropriate term (a-h). -A class of stock that provides no preference rights to shareholders

The term deficit is used to refer to a debit balance in which of the following accounts of a corporation?

Treasury stock should be reported in the financial statements of a corporation as a (n)

Earnings per share

The retained earnings statement may be combined with the income statement.

Prepare entries to record the following: (a)Issued 1,000 shares of $10 par common stock at $56 for cash. (b)Issued 1,400 shares of $10 par common stock in exchange for equipment with a fair market price of $21,000. (c)Purchased 100 shares of treasury stock at $25. (d)Sold the 100 shares of treasury stock purchased in (c) at $30.

Kansas Company acquired a building valued at $210,000 for property tax purposes in exchange for 12,000 shares of its $5 par common stock. The stock is widely traded and selling for $15 per share. At what amount should the building be recorded by Kansas Company?

Nexis Corp. issues 1,000 shares of $15 par value common stock at $22 per share. When the transaction is recorded, credits are made to

Match each of the following stockholders' equity concepts to the appropriate term (a-h). -Equity account reflecting shares "owed" to stockholders