Question 1

The day on which the board of directors of the corporation distributes a dividend is called the declaration date.

Accepted Answer

A) True 
 B)False

Question 2

The price at which a stock can be sold depends upon a number of factors. Which statement below is not one of those factors?

Accepted Answer

A)  the financial condition, earnings record, and dividend record of the corporation 
B)  investor expectations of the corporation's earning power 
C)  how high the par value is 
D)  general business and economic conditions and prospects 
A)  the financial condition, earnings record, and dividend record of the corporation 
B)  investor expectations of the corporation's earning power 
C)  how high the par value is 
D)  general business and economic conditions and prospects

Question 3

The issuance of common stock affects both paid-in capital and retained earnings.

Accepted Answer

A) True 
 B)False

Question 4

Which statement below is not a reason for a corporation to buy back its own stock.

Accepted Answer

A)  resale to employees 
B)  bonus to employees 
C)  for supporting the market price of the stock 
D)  to increase the shares outstanding 
A)  resale to employees 
B)  bonus to employees 
C)  for supporting the market price of the stock 
D)  to increase the shares outstanding

Question 5

The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 30,000 shares were originally issued and 5,000 were subsequently reacquired. What is the number of shares outstanding?

Accepted Answer

A)  35,000 
B)  70,000 
C)  25,000 
D)  30,000 
A)  35,000 
B)  70,000 
C)  25,000 
D)  30,000

Question 6

When a stock dividend is declared, which of the following accounts is credited?

Accepted Answer

A)  Common Sock 
B)  Dividend Payable 
C)  Stock Dividends Distributable 
D)  Retained Earnings 
A)  Common Sock 
B)  Dividend Payable 
C)  Stock Dividends Distributable 
D)  Retained Earnings

Question 7

Par value

Accepted Answer

A)  is the monetary value assigned per share in the corporate charter. 
B)  represents what a share of stock is worth. 
C)  represents the original selling price for a share of stock. 
D)  is established for a share of stock after it is issued. 
A)  is the monetary value assigned per share in the corporate charter. 
B)  represents what a share of stock is worth. 
C)  represents the original selling price for a share of stock. 
D)  is established for a share of stock after it is issued.

Question 8

A sale of treasury stock may result in a decrease in paid-in-capital. All decreases should be charged to the Paid-In-Capital from Sale of Treasury account.

Accepted Answer

A) True 
 B)False

Question 9

The cost method of accounting for the purchase and sale of treasury stock is a commonly used method.

Accepted Answer

A) True 
 B)False

Question 10

A 10% stock dividend will increase the number of shares outstanding but the book value per share will decrease.

Accepted Answer

A) True 
 B)False

Question 11

On April 1, 10,000 shares of $5 par common stock were issued at $22, and on April 7, 5,000 shares of $50 par preferred stock were issued at $104. Journalize the entries for April 1 and 7.

Accepted Answer

@#IMG-DLM&_TB2085_00

Question 12

When common stock is issued in exchange for land, the land should be recorded in the accounts at the par amount of the stock issued.

Accepted Answer

A) True 
 B)False

Question 13

On May 1, 10,000 shares of $10 par common stock were issued at $30, and on May 7, 5,000 shares of $50 par preferred stock were issued at $111. Journalize the entries for May 1 and May 7.

Accepted Answer

@#IMG-DLM&_TB2085_00

Question 14

The ability of a corporation to obtain capital is

Accepted Answer

A)  less than a partnership. 
B)  about the same as a partnership. 
C)  restricted because of the limited life of the corporation. 
D)  enhanced because of limited liability and ease of share transferability. 
A)  less than a partnership. 
B)  about the same as a partnership. 
C)  restricted because of the limited life of the corporation. 
D)  enhanced because of limited liability and ease of share transferability.

Question 15

A corporation has 10,000 shares of $100 par value stock outstanding. If the corporation issues a 5-for-1 stock split, the number of shares outstanding after the split will be 40,000.

Accepted Answer

A) True 
 B)False

Question 16

A corporation has 50,000 shares of $25 par value stock outstanding that has a current market value of $120. If the corporation issues a 5-for-1 stock split, the par value of the stock after the split will be:

Accepted Answer

A)  $5 
B)  $60 
C)  $25 
D)  $24 
A)  $5 
B)  $60 
C)  $25 
D)  $24

Question 17

Morocco Inc. reported the following results for the year ending April 30, 2014:
   Prepare a retained earnings statement for the fiscal year ended April 30, 2014.

Accepted Answer

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Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Match between columns
                        Premises: Total Stockholders Equity
Common Stock
Additional Paid in Capital - Common Stock
Retained Earnings
Total Paid in Capital
Additional Paid in Capital - Preferred Stock
Treasury Stock
Preferred Stock

Accepted Answer

The Answer of 20,000 and 550,000 and 100,000 and 15,000 is...

Question 20

A restriction/appropriation of retained earnings

Accepted Answer

A)  decreases total assets 
B)  increases total retained earnings 
C)  decreases total retained earnings 
D)  has no effect on total retained earnings 
A)  decreases total assets 
B)  increases total retained earnings 
C)  decreases total retained earnings 
D)  has no effect on total retained earnings

The day on which the board of directors of the corporation distributes a dividend is called the declaration date.

The price at which a stock can be sold depends upon a number of factors. Which statement below is not one of those factors?

The issuance of common stock affects both paid-in capital and retained earnings.

Which statement below is not a reason for a corporation to buy back its own stock.

The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 30,000 shares were originally issued and 5,000 were subsequently reacquired. What is the number of shares outstanding?

When a stock dividend is declared, which of the following accounts is credited?

Par value

A sale of treasury stock may result in a decrease in paid-in-capital. All decreases should be charged to the Paid-In-Capital from Sale of Treasury account.

The cost method of accounting for the purchase and sale of treasury stock is a commonly used method.

A 10% stock dividend will increase the number of shares outstanding but the book value per share will decrease.

On April 1, 10,000 shares of $5 par common stock were issued at $22, and on April 7, 5,000 shares of $50 par preferred stock were issued at $104. Journalize the entries for April 1 and 7.

When common stock is issued in exchange for land, the land should be recorded in the accounts at the par amount of the stock issued.

On May 1, 10,000 shares of $10 par common stock were issued at $30, and on May 7, 5,000 shares of $50 par preferred stock were issued at $111. Journalize the entries for May 1 and May 7.

The ability of a corporation to obtain capital is

A corporation has 10,000 shares of $100 par value stock outstanding. If the corporation issues a 5-for-1 stock split, the number of shares outstanding after the split will be 40,000.

A corporation has 50,000 shares of $25 par value stock outstanding that has a current market value of $120. If the corporation issues a 5-for-1 stock split, the par value of the stock after the split will be:

Morocco Inc. reported the following results for the year ending April 30, 2014: Prepare a retained earnings statement for the fiscal year ended April 30, 2014.

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

A restriction/appropriation of retained earnings

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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

The day on which the board of directors of the corporation distributes a dividend is called the declaration date.

The price at which a stock can be sold depends upon a number of factors. Which statement below is not one of those factors?

The issuance of common stock affects both paid-in capital and retained earnings.

Which statement below is not a reason for a corporation to buy back its own stock.

The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 30,000 shares were originally issued and 5,000 were subsequently reacquired. What is the number of shares outstanding?

When a stock dividend is declared, which of the following accounts is credited?

Par value

A sale of treasury stock may result in a decrease in paid-in-capital. All decreases should be charged to the Paid-In-Capital from Sale of Treasury account.

The cost method of accounting for the purchase and sale of treasury stock is a commonly used method.

A 10% stock dividend will increase the number of shares outstanding but the book value per share will decrease.

On April 1, 10,000 shares of $5 par common stock were issued at $22, and on April 7, 5,000 shares of $50 par preferred stock were issued at $104. Journalize the entries for April 1 and 7.

When common stock is issued in exchange for land, the land should be recorded in the accounts at the par amount of the stock issued.

On May 1, 10,000 shares of $10 par common stock were issued at $30, and on May 7, 5,000 shares of $50 par preferred stock were issued at $111. Journalize the entries for May 1 and May 7.

The ability of a corporation to obtain capital is

A corporation has 10,000 shares of $100 par value stock outstanding. If the corporation issues a 5-for-1 stock split, the number of shares outstanding after the split will be 40,000.

A corporation has 50,000 shares of $25 par value stock outstanding that has a current market value of $120. If the corporation issues a 5-for-1 stock split, the par value of the stock after the split will be:

Morocco Inc. reported the following results for the year ending April 30, 2014: Prepare a retained earnings statement for the fiscal year ended April 30, 2014.

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

A restriction/appropriation of retained earnings

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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