Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Prepare entries to record the following selected transactions completed during the current fiscal year:

Accepted Answer

The answer of Prepare entries to record the following selected...

Question 3

Journalize the following selected transactions completed during the current fiscal year:

Accepted Answer

The answer of Journalize the following selected transactions completed during...

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

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

The answer of On May 1, 10,000 shares of $10...

Question 6

Cash dividends are normally paid on shares of treasury stock.

Accepted Answer

A) True 
 B)False

Question 7

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 EarningsE) A) and B)
F) A) and C)

Question 8

A corporation has 60,000 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 number of shares outstanding will be:

Accepted Answer

A)   60,000
B)   10,000
C)   300,000
D)   30,000E) B) and D)
F) None of the above C

Question 9

Miriah Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014. What is the annual dividend on the preferred stock?

Accepted Answer

A)   $50 per share
B)   $50,000 in total
C)   $10,000 in total
D)   $0.50 per shareE) A) and B)
F) B) and C)

Question 10

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

The answer of On April 1, 10,000 shares of $5...

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

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

Accepted Answer

A)   Common Stock
B)   Paid-In Capital in Excess of Par
C)   Dividends in Arrears
D)   Retained EarningsE) A) and C)
F) B) and D) C

Question 13

The excess of sales price of treasury stock over its cost should be credited to

Accepted Answer

A)   Treasury Stock Receivable
B)   Premium on Capital Stock
C)   Paid-In Capital from Sale of Treasury Stock
D)   Income from Sale of Treasury StockE) A) and B)
F) A) and C)

Question 14

The par value per share of common stock represents

Accepted Answer

A)   the minimum selling price of the stock established by the articles of incorporation.
B)   the minimum amount the stockholder will receive when the corporation is liquidated
C)   an arbitrary amount established in the articles of incorporation
D)   the amount of dividends per share to be received each yearE) All of the above
F) B) and D)

Question 15

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 outstandingE) None of the above
F) A) and B)

Question 16

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:

Accepted Answer

A)   Common Stock $15,000 and Paid-in Capital in Excess of Par Value $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) All of the above
F) A) and B)

Question 17

Under the cost method, when treasury stock is purchased by the corporation, the par value and the price at which the stock was originally issued are important.

Accepted Answer

A) True 
 B)False

Question 18

If 50,000 shares are authorized, 41,000 shares are issued, and 2,000 shares are reacquired, the number of outstanding shares is 43,000.

Accepted Answer

A) True 
 B)False

Question 19

Sabas Company has 20,000 shares of $100 par, 1% non-cumulative 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.

Accepted Answer

The answer of Sabas Company has 20,000 shares of $100...

Question 20

When Bayou Corporation was formed on January 1, 20xx, the corporate charter provided for 100,000 share of $10 par value common stock. The following transaction was among those engaged in by the corporation during its first month of operation: The corporation issued 9,000 shares of stock at a price of $23 per share. The entry to record the above transaction would include a

Accepted Answer

A)   debit to Cash for $90,000
B)   credit to Common Stock for $207,000
C)   credit to Paid in Capital in Excess of Par for $117,000
D)   debit to Common Stock for $90,000E) A) and C)
F) B) and C)

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

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

Correct Answer
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Prepare entries to record the following selected transactions completed during the current fiscal year:

Correct Answer
verified
11ea9439_7175_711a_8ff9_238c36d818a4_TB2013_00_TB2013_00

Journalize the following selected transactions completed during the current fiscal year:

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

Correct Answer
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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.

Correct Answer
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Cash dividends are normally paid on shares of treasury stock.

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

Correct Answer
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A corporation has 60,000 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 number of shares outstanding will be:

Correct Answer
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C

Miriah Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014. What is the annual dividend on the preferred stock?

Correct Answer
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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.

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

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

Correct Answer
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C

The excess of sales price of treasury stock over its cost should be credited to

Correct Answer
verified

The par value per share of common stock represents

Correct Answer
verified

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

Correct Answer
verified

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:

Correct Answer
verified

Under the cost method, when treasury stock is purchased by the corporation, the par value and the price at which the stock was originally issued are important.

Correct Answer
verified

If 50,000 shares are authorized, 41,000 shares are issued, and 2,000 shares are reacquired, the number of outstanding shares is 43,000.

Correct Answer
verified

Sabas Company has 20,000 shares of $100 par, 1% non-cumulative 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.

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

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

Correct AnswerverifiedShow Answer

Prepare entries to record the following selected transactions completed during the current fiscal year:

Correct Answerverified11ea9439_7175_711a_8ff9_238c36d818a4_TB2013_00_TB2013_00

Journalize the following selected transactions completed during the current fiscal year:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

Cash dividends are normally paid on shares of treasury stock.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A corporation has 60,000 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 number of shares outstanding will be:

Correct AnswerverifiedC

Miriah Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014. What is the annual dividend on the preferred stock?

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedC

The excess of sales price of treasury stock over its cost should be credited to

Correct AnswerverifiedShow Answer

The par value per share of common stock represents

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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:

Correct AnswerverifiedShow Answer

Under the cost method, when treasury stock is purchased by the corporation, the par value and the price at which the stock was originally issued are important.

Correct AnswerverifiedShow Answer

If 50,000 shares are authorized, 41,000 shares are issued, and 2,000 shares are reacquired, the number of outstanding shares is 43,000.

Correct AnswerverifiedShow Answer

Sabas Company has 20,000 shares of $100 par, 1% non-cumulative 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.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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Correct Answer
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11ea9439_7175_711a_8ff9_238c36d818a4_TB2013_00_TB2013_00

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C

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C

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