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Exam 11: Stockholders Equity

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Question 71

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If 20,000 shares are authorized, 15,000 shares are issued, and 500 shares are held as treasury stock, a cash dividend of $1 per share would amount to $15,000.

A) True
B) False

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Question 72

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Select the best answer from the list below to complete statements that follow. -The number of shares sold or distributed to stockholder are .

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Question 73

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Which of the following is reported as a financing activity?

Anole Company Anole Company was incorporated as a new business on January 1, 2015.The company is authorized to issue 20,000 shares of $5 par value common stock and 10,000 shares of 6%, $10 par value, cumulative, participating preferred stock.On January 1, 2015, the company issued 8,000 shares of common stock for $15 per share and 2,000 shares of preferred stock for $30 per share.Net income for the year ended December 31, 2015, was $375,000. -Refer to the information about Anole Company. The amount of Anole's total contributed capital at December 31, 2015, is

An accounting transaction is not recorded when a corporation declares and executes a stock split.

Big Surf Shop provided the following information from its 2015 financial statements: In addition, the stockholders' equity section of the balance sheet showed: The common stock had a year-end market price of $24. A) Calculate the book value per common share at year-end. B) Indicate the usefulness of this ratio for Big Surf Shop.

Roehr Corporation issues 20,000 shares of $0.50 par common stock for $6 per share; the Additional Paid-in Capital-Common account will increase by

On January 1, 2015, Bogart Acres Company issued 10,000 shares of 10%, $20 par value cumulative preferred stock.In 2015 and 2016, no dividends were declared on preferred stock.In 2017, Bogart had a profitable year and decided to pay dividends to stockholders of both preferred and common stock.If they have $200,000 available for dividends in 2017, how much could it pay to the common stockholders?

Comfort Shoes had the following items included in its accounting records.In the space provided, indicate whether each of the items listed is included in an account in the stockholders' equity section of the balance sheet.

Walton Corporation shows the following in the stockholders' equity section of its balance sheet: The stated value of its common stock is $0.50 and the total balance in the common stock account is $37,500.Also noted is that 5,000 shares are currently designated as treasury stock.The number of shares outstanding is

With respect to the statement of cash flows,

When treasury stock is resold for an amount less than its cost, the difference between the sales price and the cost is deducted from the Additional Paid­In Capital-Treasury Stock account or the Retained Earnings account if the Additional Paid­In Capital-Treasury Stock account does not exist).

Winslow Corporation reported the following in the stockholders' equity section of its balance sheet at December 31, 2015: How many shares of stock are issued?

Prairie Charters reported the following information at December 31, 2015: The average recorded value per share of common stock at December 31, 2015 is

Which of the following should be considered when a company decides to declare a cash dividend on common stock?

How is treasury stock shown on the balance sheet?

A company would repurchase its own stock for all of the following reasons except

The statement of stockholders' equity is useful in evaluating a company's liquidity.

Watson Company has 5,000 shares of $5 par, 3% preferred stock outstanding, and 25,000 shares of $2 par common stock outstanding.The preferred stock is cumulative and no dividends have been paid for the past two years.If the company wishes to distribute $2 per share to the common stockholders, what is the total amount of dividends that must be paid in the current year?

A new company issues 2,000 shares of $5 par common stock in exchange for the services of a lawyer during its first month of business.The lawyer's normal fee is $15,000 for similar work.Which of the following would be recorded if the stock is not currently trading?