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Exam 12: Corporations: Organization, stock Transactions, and Dividends

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Question 1

True/False

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If 100 shares of treasury stock were purchased for $50 per share and then sold at $60 per share,$1,000 of income is reported on the income statement.

A) True
B) False

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Question 2

Multiple Choice

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

A) Common Stock,$15,000,and Paid-In Capital in Excess of Par,$7,000
B) Common Stock,$22,000,and Retained Earnings,$15,000
C) Common Stock,$7,000,and Paid-In Capital in Excess of Stated Value,$15,000
D) Common Stock,$22,000

E) A) and D)
F) B) and C)

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Question 3

Multiple Choice

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The charter of a corporation provides for the issuance of 100,000 shares of common stock.Assume that 60,000 shares were originally issued and 10,000 were subsequently reacquired.What is the amount of cash dividends to be paid if a $2 per share dividend is declared?

All of the following are normally found in a corporation's stockholders' equity section except

Match the following stockholders' equity concepts to the appropriate term (a-h) .​ -The date that is used to determine the owners of stock who will receive the current dividend

Using the following information,prepare the stockholders' equity section of the balance sheet.Seventy thousand shares of common stock are authorized and 7,000 shares have been reacquired. ​

The main source of paid-in capital is from issuing stock.

Match the following stockholders' equity concepts to the appropriate term (a-h) .​ -A financial institution that records and maintains records of another company's stockholders.

On April 2 a corporation purchased for cash 5,000 shares of its own $10 par common stock at $16 a share.It sold 3,000 of the treasury shares at $19 a share on June 10.The remaining 2,000 shares were sold on November 10 for $12 a share. ​

While some businesses have been granted charters under state laws,most businesses receive their charters under federal laws.

Sabas Company has 20,000 shares of $100 par,1% noncumulative preferred stock and 100,000 shares of $50 par common stock.The following amounts were distributed as dividends: ​ Determine the dividends per share for preferred and common stock for each year.

Which of the following is the appropriate general journal entry to record the declaration of cash dividends?

Which of the following statements concerning taxation is accurate?

Carmen Company is a corporation that has issued both preferred and common stock.As of January 1,it had 50,000 shares of 2.75% $100 par,preferred stock outstanding and 250,000 shares of $10 par common stock outstanding.Journalize the following transactions. ​ (a)On January 31,the board of directors issues a requirement to purchase 5,000 shares of its common stock at market price.The shares are purchased at a market price of $22 per share. ​​ (b)On March 15,Carmen declares a dividend on preferred stock of $2.75 per share.The date of record is March 25 and the date of payment is March 31. ​​ (c)On December 1,Carmen declares a cash dividend on common stock of $0.12 per share.The date of record is December 15 and the date of payment is December 21. ​​ (d)On December 27,the board orders that 2,500 shares of the treasury stock purchased in (a)be sold.The sale price is $25 per share.

Twenty percent of all businesses in the United States are corporations,and they account for 80% of the total business dollars generated.

The excess of issue price over par of common stock is termed a(n)

The amount of a corporation's retained earnings that has been restricted / appropriated should be reported in the notes to the financial statements.

The Sneed Corporation issues 10,000 shares of $50 par preferred stock for cash at $75 per share.The entry to record the transaction will consist of a debit to Cash for $750,000 and a credit or credits to

Match each of the following stockholders' equity concepts to the most appropriate term (a-h) . -A class of stock having first rights to dividends of a corporation

Par value