Orion Chapter 11

Which of the following is true about corporations?

In what way is a corporation different from a sole proprietorship or partnership?

The issuance of common stock affects

When a corporation purchases treasury stock, the acquisition

When a company declares a stock dividend, the declaration will

What happens if no-par value stock does not have a stated value?

A-Team Corporation issued 1,000 shares of $5 par value stock for land. The stock is actively traded at $9 per share. The land was advertised for sale at $10,500. The land should be recorded at

ABC Corporation issues 1,000 shares of $10 par value common stock at $12 per share. In recording the transaction, credits are made to

Which of the following statements is true?

When a company offers a ________, the event does not require a formal journal entry on a corporation's books.

Taft Industries had 250,000 shares of common stock outstanding before a stock split occurred and 500,000 shares outstanding after the stock split. The stock split was

Candela Company has retained earnings of $500,000, common stock of $400,000, and total common stockholders' equity of $1,200,000. It has 200,000 shares of $2 par value common stock outstanding which is currently selling for $5 per share. If Candela Company declares a 2-for-1 stock split on its common stock, which of the following will occur?

To find the return on common stockholders' equity, divide net income available to common stockholders by ________ stockholders' equity.

When companies set their dividend payout, they generally aim for a rate that is

The board of directors of Pilgrim Company authorizes a $100,000 restriction of retained earnings for a future plant expansion. This action will

Stewart Soaps began business by issuing 25,000 shares of $5 par value common stock for $20 per share. During its first year, the corporation sustained a net loss of $5,000. The year-end balance sheet would show

Clayworks Corporation issued 300,000 shares of $5 par value common stock for $26 per share. During that year, the corporation sustained a net loss of $80,000. The year-end balance sheet would show

Hadley Corporation issued 200,000 shares of $5 par value common stock for $25 per share. During that year, the corporation sustained a net loss of $40,000. The year-end balance sheet would show

Which of the following statements is true?

What happens if no-par stock is issued without a stated value?

Closeknit Corporation has a limited number of stockholders. As a privately held corporation, Closeknit is exempt from

Tabitha and Gerald are discussing common stock that they hold. Tabitha states that she purchased hers through the New York Stock Exchange, but Gerald says that he purchased his by investing in his brother-in-law's company. What is the difference between the investments of Tabitha and Gerald?

Romine Industries has total stockholders' equity of $4,982,000. Given the following information, what is the company's total additional paid-in capital? Common Stock, $3 par (400,000 shares authorized, 358,000 shares issued and outstanding). Preferred Stock, 4%, $100 par (5,000 shares authorized, issued, and outstanding). Retained Earnings (ending balance): $2,619,000

One reason that companies often choose to issue no-par value common stock rather than par value common stock is that

Jennifer and Hernando are both accountants at their companies. Both companies issued new shares of common stock. When Jennifer journalized her stock transaction, she credited both the Common Stock and the Paid-in Capital in Excess of Stated Value account. When Hernando journalized his stock transaction, he only credited the Common Stock account. What is one reason this difference may have occurred?

Claire and David hold stock in two different companies, but both recently received additional shares of common stock rather than a cash dividend. After receiving the additional stock, the par value of Claire's stock decreased by 67%, but the par value of David's stock remained the same. What is the difference between Claire and David?

Which of the following companies has the highest return on common stockholders' equity?

Felix Incorporated has just exchanged 1,250 shares of $65 par-value preferred stock for a parcel of land advertised for a price of $90,000. If the current market value of the stock is $75 per share, how should Felix journalize this transaction?

In 2015, First Inc. issued 12,000 shares of 8%, $60 par-value preferred stock with a cumulative-dividend feature. In 2015, the firm paid total dividends of $30,000, and in 2016, it paid total dividends of $45,000. If First declares $180,000 in total dividends for 2017, what amount will be available for its common stockholders?

Which value of stock is most relevant for potential stockholders of a corporation?

The following data is available for Wingate Corporation at December 31st, 2017: Common stock, par $10 (authorized 30,000 shares) $260,000 Treasury stock (at cost $15 per share) $1,200 Based on the data, how many shares of common stock are issued?

What is the return on common stockholders' equity based on the following: Beginning Common Stock: $1 par (500,000 shares authorized, 400,000 shares outstanding) Beginning Additional Paid-in Capital, Common Stock: $1,600,000 Ending Common Stock: $1 par (500,000 shares authorized, 460,000 shares outstanding) Ending Additional Paid-in Capital, Common Stock: $1,800,000 Net Income: $362,500 Preferred Stock throughout the year: 8%, $50 par (10,000 shares authorized and outstanding).

One major difference between a partnership and a corporation is that

Design Dividends on preferred stock Corporation has 400,000 shares of $10 par-value common stock issued and outstanding when the market price per share is $25 per share. By what amount will total equity increase when the company declares a 2:1 stock split?

Which of the following companies has the LOWEST payout ratio?

How does the accounting process differ if a company issues both common and preferred stock instead of only common stock?

Spears Corporation recently issued 100,000 shares of its $2 par value common stock for $315,000. Which amounts represent legal capital and total paid-in capital, respectively?

Edge Corporation issues 20,000 shares of $5 stated value no par stock in exchange for land with an advertised price of $125,000 when the stock is actively trading for $6 per share. Journalize the entry to recognize the exchange.