FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 11: Stockholders Equity: Paid-In Capital

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Multiple Choice

Review LaterAdd Note

Review Later

Century Corporation issued 400,000 shares of $4 par value common stock at the time of its incorporation. The stock was issued for cash at a price of $16 per share. During the first year of operations, the company sustained a net loss of $100,000. The year-end balance sheet would show the balance of the Common Stock account to be:

A) $1,600,000.
B) $1,500,000.
C) $6,300,000.
D) $6,400,000.

Correct Answer

verified

Show Answer

Question 2

Essay

Review LaterAdd Note

Review Later

Prepare journal entries for stockholders' equity transactions. A partial list of the ledger accounts of Hellman Company is shown below, followed by a list of transactions. Indicate the accounts that would be debited and credited in recording each transaction. $\begin{array} { | l | l | c | l | } \hline 1 & \text { Cash } & 21 & \text { Common Stock, \$2 Par } \\\hline 2 & \text { Land } & 25 & \text { Additional Paid-In Capital } \\\hline 3 & \text { Organization Costs } & 26 & \text { Donated Capital } \\\hline 10 & \text { Dividends Payable } & 30 & \text { Retained Earnings } \\\hline 20 & \text { Preferred Stock, \$100 Par } & 40 & \text { Income Summary } \\\hline\end{array}$ $\begin{array}{|c|c|c|c|}\hline&\text { Transactions } & \text { Account }(\mathrm{s}) & \text { Accounts(s) }\\\hline & & \text { Debited } & \text { Credited } \\\hline & \begin{array}{l}\text { Example: Issued preferred stock for cash at a } \\\text { price above par. }\end{array} & 1 & 20,25 \\\hline \text { (a) } & \begin{array}{l}\text { The City of Hartford donated land to Hellman } \\\text { Company to be used as a building site. }\end{array} & & \\\hline \text { (b) } & \text { Declared a cash dividend on common stock. } & & \\\hline \text { (c) } & \begin{array}{l}10,000 \text { shares of common stock are issued at } \\\text { price above par. }\end{array} & & \\\hline \text { (d) } & \begin{array}{l}1,000 \text { shares of } \$ 2 \text { par common stock are issued } \\\text { in exchange for attorney services relating to } \\\text { formation of corporation, value } \$ 3,750\end{array} & & \\\hline \text { (e) } & \begin{array}{l}\text { Income Summary account is closed at the end of } \\\text { a period in which Hellman Company reported a } \\\text { net loss }\end{array} & & \\\hline \text { (f) } & \text { The dividend declared in } b \text {, above, is paid. } & & \\\hline\end{array}$

Correct Answer

verified

None...

View Answer

Show Answer

Question 3

Multiple Choice

Review LaterAdd Note

Stock that had been issued by a corporation, and later reacquired, is classified as:

On January 1, 2009, Juniper Corporation issued 60,000 shares of its total 200,000 authorized shares of $4 par value common stock for $8 per share. On December 31, 2009, Juniper Corporation's common stock is trading at $12 per share. -Refer to the information above. Assume Juniper Corporation decides to issue an additional 1,000 shares of its common stock on December 31, 2009. How will the above increase in value affect Juniper?

The directors of a corporation:

Santa Fe Boat Yard has total stockholders' equity of $4,100,000, comprised of the following: Assuming there are no dividends in arrears, the book value per share of common stock is:

Shown below is information relating to the stockholders' equity of Brookdale Corporation at December 31, 2010: $\begin{array}{|l|l|l|}\hline 11 \% \text { cumulative preferred stock, } \$ 130 \text { par, } 100,000 \text { shares } & \$ 1,300,000 \\\text { authorized, } 10,000 \text { shares issued } & \\\hline \text { Common stock, } \$ 1.25 \text { par, } 1,000,000 \text { shares authorized, } & 750,000 \\600,000 \text { shares issued (of which } 6,000 \text { are held in treasury) } & \\\hline \text { Additional paid-in capital: preferred stock } & 500,000 \\\hline \text { Additional paid-in capital: common stock } & 900,000 \\\hline \text { Additional paid-in capital: treasury stock transactions } & 6,000 \\\hline \text { Treasury stock (at cost: } 6,000 \text { common shares) } & (192,000) \\\hline \text { Retained earnings } & 1,350,000 \\\hline\end{array}$ -Refer to the information above. The average issue price per share of the preferred stock was:

When a corporation issues capital stock at a price higher than the par value:

Which of the following is not a characteristic of most preferred stocks?

The net assets of a corporation are equal to:

On September 1, 2011, Miami Corporation's common stock was selling at a market price of $300 per share. On that date, Miami announced a 2 for 1 stock split. At what price would you expect the stock to trade immediately after the split goes into effect?

On April 16, 2010, Rodriguez Corporation reacquired 12,000 shares of its own $10 par stock for $660,000 cash. On November 4, 2011, 1,000 of the treasury shares were reissued at a price of $65 per share. The journal entry to record the reissuance of the 1,000 shares of stock on November 4 includes a:

Only preferred stock of a corporation must have a par value.

The rights of a common stockholder do not include the right:

A 2-for-1 stock split will have what effect upon the following items?

Shown below is information relating to the stockholders' equity of Novake Corporation at December 31, 2010: From the above information, compute the following: $\begin{array}{lrr} \text { 8 \% cumulative preferred stock, \( \$ 100 \) par, } &\\ \text { 100,000 shares authorized, 7,000 shares issued } &\$700,000\\ \text { Common stock, \( \$ 3 \) par, 1,000,000 shares authorized,} &\\ \text {500,000 shares issued and outstanding. } &1,500,000\\ \text {Additional paid-in capital: preferred stock. } &400,000\\ \text { Additional paid-in capital: common stock } &500,000\\ \text { Retained earnings. } &800,000\end{array}$ -The total amount of paid-in capital: $__________

Paid-in-capital includes donated capital.

Vision Corporation has the following information on its financial statement: $\begin{array} { | l | r | } \hline \text { Preferred Stock } 6 \% , \$ 100 \text { par, cumulative, } 10,000 \text { shares } & \\\hline \text { authorized } & \$ 450,000 \\\hline \text { Common Stock, } \$ 3 \text { par, } 500,000 \text { shares authorized, } & \\\hline 240,000 \text { issued } & 720,000 \\\hline \text { Paid-in Capital - Preferred } & 750,000 \\\hline \text { Paid-in Capital - Common } & 3,000,000 \\\hline \text { Retained earnings } & 1,192,500 \\\hline & \\\hline\end{array}$ -Refer to the information above. If Vision did not pay a dividend for the last two years, but declared a dividend this year, how much will they have to declare in order for the common stockholders to receive $.45 per share?

Which of the following is not a right of stockholders?

The market price of a preferred stock will be affected by: