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

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Question 31

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The declaration of a stock dividend decreases a corporation's stockholders' equity and increases its liabilities.

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Question 32

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A corporation has 50,000 shares of $25 par value stock outstanding. If the corporation issues a 3-for-1 stock split, the number of shares outstanding after the split will be

A) 150,000 shares
B) 50,000 shares
C) 100,000 shares
D) 16,666 shares

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Question 33

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Which of the following would appear as a prior-period adjustment?

A corporation has 50,000 shares of $28 par value stock outstanding that has a current market value of $150. If the corporation issues a 4-for-1 stock split, the market value of the stock will fall to approximately

Twenty percent of all businesses in the United States are corporations and they account for 80% of the total business dollars generated.

Prepare entries to record the following:

Prepare entries to record the following:

The excess of issue price over par of common stock is termed a(n)

Match the following stockholders equity concepts to the appropriate answer.

When no-par common stock with a stated value is issued for cash, the common stock account is credited for an amount equal to the cash proceeds.

Significant changes in stockholders' equity are reported in

Merritt Company acquired a building valued at $210,000 for property tax purposes in exchange for 12,000 shares of its $5 par common stock. The stock is widely traded and selling for $18 per share. At what amount should the building be recorded by Merritt Company?

Sabas Company has 20,000 shares of $100 par, 2% 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 the second year.

A corporation has 50,000 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 par value of the stock after the split will be:

The main source of paid-in-capital is from issuing stock.

The Sneed Corporation issues 10,000 shares of $50 par value preferred stock for cash at $75 per share. The entry to record the transaction will consist of a debit to Cash for $750,000 and a credit or credits to

The state charter allows a corporation to issue only a certain number of shares of each class of stock. This amount of stock is called

The declaration of a cash dividend decreases a corporation's stockholders equity and decreases its assets.

Which of the following is not characteristic of a corporation?

Before a stock dividend can be declared or paid, there must be sufficient cash.