Question 1

Houston Corporation has the following stock outstanding:  In 2012,Houston paid $330,000 in dividends.No dividends were paid in 2011 or 2010.
Required:
a)Compute the total amount of dividends that was paid to each class of stock.
b)Compute the amount of dividends per share for each class of stock.

Accepted Answer

a)To preferred shareholders: (3)(.05)(1,...

Question 2

A small,closely-held corporation can avoid double taxation by electing S Corporation status.

Accepted Answer

A) True 
 B)False

Question 3

At the time that Stellar Company issued a 2-for-1 stock split,the company had 1,000 shares of $5 par value common stock outstanding.Stockholders' equity also included $14,000 of additional paid in capital in excess of par value and $20,000 of retained earnings.Immediately after the stock split,

Accepted Answer

A)   the balance in the common stock account would be $10,000.
B)   the amount of paid-in capital would be $20,000.
C)   the balance in the retained earning account would be $15,000.
D)   the balance in the common stock account would be $5,000.E) None of the above
F) All of the above

Question 4

A reason often given for a stock split is:

Accepted Answer

A)   to protect the interest of creditors.
B)   to reduce the market price of the stock.
C)   to increase the par value of the stock.
D)   to absorb the treasury stock.E) A) and B)
F) B) and C)

Question 5

Indicate whether each of the following statements is true or false.

Accepted Answer

The answer of Indicate whether each of the following statements...

Question 6

Thad Rives is planning to invest in one of the following companies based on their average performance over the past five years,which is presented below.  If Thad is looking for a growth company (with earnings that are growing rapidly and probably will continue to grow rapidly) ,which one should he choose?

Accepted Answer

A)   Big Bat,Inc.
B)   Bug-lite,Inc.
C)   "Mood-blue,Inc".
D)   Jones,Inc.E) B) and D)
F) C) and D)

Question 7

Anstendig Corp.has 250,000 shares of common stock authorized.It has issued 75,000 shares and has reacquired 12,000 of these shares as treasury stock.Anstendig subsequently declared a cash dividend of $3 per share.What is the total amount of dividends that were declared?

Accepted Answer

The answer of Anstendig Corp.has 250,000 shares of common stock...

Question 8

Discuss possible reasons why a corporation may establish an appropriation of retained earnings.

Accepted Answer

Appropriations are sometimes required by...

Question 9

Discuss a reason why a corporation might "split" its common stock.

Accepted Answer

A corporation may sp...

Question 10

Explain the significance of a high price-earnings ratio.

Accepted Answer

A high price-earning...

Question 11

Wiley Corporation issued 5,000 shares of no-par common stock for $32 per share.For this transaction,Common Stock should be credited (increased)for $160,000.

Accepted Answer

A) True 
 B)False

Question 12

Calculate the number of shares outstanding after the stock dividends are issued.

Accepted Answer

A)   7,950 shares
B)   53,000 shares
C)   60,950 shares
D)   79,500 sharesE) B) and D)
F) All of the above

Question 13

A separate capital account is maintained for each partner in a partnership.

Accepted Answer

A) True 
 B)False

Question 14

Establishing a sole proprietorship generally requires the owner to get a charter from the state government.

Accepted Answer

A) True 
 B)False

Question 15

Reissuance of treasury stock for cash is what kind of transaction?

Accepted Answer

A)   asset source
B)   asset use
C)   asset exchange
D)   claims exchangeE) B) and C)
F) C) and D)

Question 16

Which of the following terms designates the number of shares of a corporation's stock currently held by stockholders?

Accepted Answer

A)   outstanding shares
B)   authorized shares
C)   treasury stock
D)   issued sharesE) None of the above
F) A) and C)

Question 17

Which of the following is not normally a preference given to the holders of preferred stock?

Accepted Answer

A)   The right to vote before the common stockholders at the corporation's annual meeting.
B)   The right to receive a specified amount of dividends prior to any being paid to common stockholders.
C)   The right to receive preference over common stockholders as to the distribution of assets during a liquidation process.
D)   All of these are normal preferences for preferred stockholders.E) A) and D)
F) A) and C)

Question 18

When a corporation records a stock dividend,it decreases Retained Earnings for the par value of the stock.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following represents the normal sequence of items presented in the Stockholders' Equity section of a corporation's balance sheet?

Accepted Answer

A)   Stock accounts,Paid-in Capital in Excess accounts,Retained Earnings,Treasury Stock
B)   Stock accounts,Paid-in Capital in Excess accounts,Treasury Stock,Retained Earnings
C)   Stock accounts,Treasury Stock,Paid-in Capital in Excess accounts,Retained Earnings
D)   Retained Earnings,Stock accounts,Paid-in Capital in Excess accounts,Treasury StockE) A) and C)
F) None of the above

Question 20

The issuance of a stock dividend will

Accepted Answer

A)   not affect total equity.
B)   increase retained earnings.
C)   decrease total paid-in capital.
D)   decrease net income.E) B) and C)
F) A) and B)

Exam 8: Proprietorships, partnerships, and Corporations

At the time that Stellar Company issued a 2-for-1 stock split,the company had 1,000 shares of $5 par value common stock outstanding.Stockholders' equity also included $14,000 of additional paid in capital in excess of par value and $20,000 of retained earnings.Immediately after the stock split,

Correct Answer
verified

Discuss a reason why a corporation might "split" its common stock.

Correct Answer
verified
A corporation may sp...
View Answer

Explain the significance of a high price-earnings ratio.

Correct Answer
verified
A high price-earning...
View Answer

A separate capital account is maintained for each partner in a partnership.

Correct Answer
verified

Correct Answer
verified

Discuss possible reasons why a corporation may establish an appropriation of retained earnings.

Correct Answer
verified
Appropriations are sometimes required by...
View Answer

A reason often given for a stock split is:

Correct Answer
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Reissuance of treasury stock for cash is what kind of transaction?

Correct Answer
verified

Which of the following is not normally a preference given to the holders of preferred stock?

Correct Answer
verified

Houston Corporation has the following stock outstanding: In 2012,Houston paid $330,000 in dividends.No dividends were paid in 2011 or 2010. Required: a)Compute the total amount of dividends that was paid to each class of stock. b)Compute the amount of dividends per share for each class of stock.

Correct Answer
verified
a)To preferred shareholders: (3)(.05)(1,...
View Answer

When a corporation records a stock dividend,it decreases Retained Earnings for the par value of the stock.

Correct Answer
verified

A small,closely-held corporation can avoid double taxation by electing S Corporation status.

Correct Answer
verified

Anstendig Corp.has 250,000 shares of common stock authorized.It has issued 75,000 shares and has reacquired 12,000 of these shares as treasury stock.Anstendig subsequently declared a cash dividend of $3 per share.What is the total amount of dividends that were declared?

Correct Answer
verified

The issuance of a stock dividend will

Correct Answer
verified

Which of the following terms designates the number of shares of a corporation's stock currently held by stockholders?

Correct Answer
verified

Indicate whether each of the following statements is true or false.

Correct Answer
verified

Calculate the number of shares outstanding after the stock dividends are issued.

Correct Answer
verified

Establishing a sole proprietorship generally requires the owner to get a charter from the state government.

Correct Answer
verified

Wiley Corporation issued 5,000 shares of no-par common stock for $32 per share.For this transaction,Common Stock should be credited (increased)for $160,000.

Correct Answer
verified

Which of the following represents the normal sequence of items presented in the Stockholders' Equity section of a corporation's balance sheet?

Correct Answer
verified

Exam 8: Proprietorships, partnerships, and Corporations

At the time that Stellar Company issued a 2-for-1 stock split,the company had 1,000 shares of $5 par value common stock outstanding.Stockholders' equity also included $14,000 of additional paid in capital in excess of par value and $20,000 of retained earnings.Immediately after the stock split,

Correct AnswerverifiedShow Answer

Discuss a reason why a corporation might "split" its common stock.

Correct AnswerverifiedA corporation may sp...View AnswerShow Answer

Explain the significance of a high price-earnings ratio.

Correct AnswerverifiedA high price-earning...View AnswerShow Answer

A separate capital account is maintained for each partner in a partnership.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Discuss possible reasons why a corporation may establish an appropriation of retained earnings.

Correct AnswerverifiedAppropriations are sometimes required by...View AnswerShow Answer

A reason often given for a stock split is:

Correct AnswerverifiedShow Answer

Reissuance of treasury stock for cash is what kind of transaction?

Correct AnswerverifiedShow Answer

Which of the following is not normally a preference given to the holders of preferred stock?

Correct AnswerverifiedShow Answer

Houston Corporation has the following stock outstanding: In 2012,Houston paid $330,000 in dividends.No dividends were paid in 2011 or 2010. Required: a)Compute the total amount of dividends that was paid to each class of stock. b)Compute the amount of dividends per share for each class of stock.

Correct Answerverifieda)To preferred shareholders: (3)(.05)(1,...View AnswerShow Answer

When a corporation records a stock dividend,it decreases Retained Earnings for the par value of the stock.

Correct AnswerverifiedShow Answer

A small,closely-held corporation can avoid double taxation by electing S Corporation status.

Correct AnswerverifiedShow Answer

Anstendig Corp.has 250,000 shares of common stock authorized.It has issued 75,000 shares and has reacquired 12,000 of these shares as treasury stock.Anstendig subsequently declared a cash dividend of $3 per share.What is the total amount of dividends that were declared?

Correct AnswerverifiedShow Answer

The issuance of a stock dividend will

Correct AnswerverifiedShow Answer

Which of the following terms designates the number of shares of a corporation's stock currently held by stockholders?

Correct AnswerverifiedShow Answer

Indicate whether each of the following statements is true or false.

Correct AnswerverifiedShow Answer

Calculate the number of shares outstanding after the stock dividends are issued.

Correct AnswerverifiedShow Answer

Establishing a sole proprietorship generally requires the owner to get a charter from the state government.

Correct AnswerverifiedShow Answer

Wiley Corporation issued 5,000 shares of no-par common stock for $32 per share.For this transaction,Common Stock should be credited (increased)for $160,000.

Correct AnswerverifiedShow Answer

Which of the following represents the normal sequence of items presented in the Stockholders' Equity section of a corporation's balance sheet?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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A corporation may sp...
View Answer

Correct Answer
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A high price-earning...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Appropriations are sometimes required by...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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a)To preferred shareholders: (3)(.05)(1,...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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