ACC 211 – EXAM 4 Quiz 11

27 November 2022
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question
How is treasury stock shown on the balance sheet?
answer
as a decrease in stockholders' equity
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The authorized stock of a corporation
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is indicated in its charter
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If common stock is issued for an amount greater than par value, the excess should be credited to
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Paid-in Capital in Excess of Par Value
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A corporation purchases 10,000 shares of its own $10 par common stock for $35 per share, recording it at cost. What will be the effect on total stockholders' equity?
answer
decrease, $350,000
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When a corporation completes a 3-for-1 stock split
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"the market price per share of stick is decreased" & "the par value per share is decreased"
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Which of the following statements concerning taxation is accurate?
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corporations pay federal and state income taxes
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The reduction of par or stated value of stock by issuance of a proportionate number of additional shares is termed a
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stock split
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Which of the following statement is NOT true about a 2-for-1 split
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total contributed capital increases
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Earnings per share
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All of the above
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All of the following are normally found in a corporation's stockholders' equity section except
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dividends in arrears
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The entry to record the issuance of 150 shares of $5 par common stock at par to an attorney in payment of legal fees for organizing the corporation includes a credit to
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common stock
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Which of the following would appear as a prior-period adjustment?
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error in the computation of depreciation expense in the preceding year
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On January 1, 20xx, Swenson Corporation had 40,000 shares of $10 par value common stock issued and outstanding. All 40,000 shares had been issued in a prior period at $20 per share. On February 1, 20xx, Swenson purchased 4,000 shares of treasury stock for $24 per share and later sold the treasury shares for $21 per share on March 1, 20xx.
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Debit to Treasury Stock for $96,000
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Which of the following is NOT a right possessed by common stockholders of a corporation?
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the right to receive a minimum amount of dividends
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Stockholders' equity
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includes retained earnings and paid-in capital
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Par value
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is the monetary value assigned per share in the corporate charter
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One of the main disadvantages of the corporate form is the
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double taxation of dividends
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What is the total stockholders' equity based on the following data? Common Stock: $630,000 Excess of Issue Price Over Par: 375,000 Retained earnings (deficit): (65,000)
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$940,000
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A company with 100,000 authorized shares of $4 par common stock issued 40,000 shares at $8. Subsequently, the company declared a 4% stock dividend on a date when the market price was $12 a share. What is the amount transferred from the Retained Earnings account to Paid-in Capital accounts as a result of the stock dividend?
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$19,200
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In which section of the financial statements would Paid-In Capital from Sale of Treasury Stock be reported?
answer
stockholders' equity on balance sheet