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Clothing Emporium was organized on January 1, 2015. The firm was authorized to issue 100,000 shares of $5 par value common stock. During 2015, Clothing Emporium had the following transactions relating to shareholders' equity: Issued 30,000 shares of common stock at $7 per share. Issued 20,000 shares of common stock at $8 per share. Reported a net income of $100,000. Paid dividends of $50,000. What is the total stockholders' equity at the end of 2015?

$420,000.

California Adventures issues 5,000 shares of 8%, $100 par value preferred stock at the beginning of 2014. All remaining shares are common stock. The company was not able to pay dividends in 2014, but plans to pay dividends of $100,000 in 2015. Assuming the preferred stock is cumulative, how much of the $100,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2015?

$6,000 to preferred stockholders and $12,000 to common stockholders.

The Surf's Up issues 1,000 shares of 6%, $100 par value preferred stock at the beginning of 2014. All remaining shares are common stock. The company was not able to pay dividends in 2014, but plans to pay dividends of $18,000 in 2015. Assuming the preferred stock is noncumulative, how much of the $18,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2015?

$6,000 to preferred stockholders and $12,000 to common stockholders.

Over the first four years of the company's life, it earned the following net income (loss): $6,000; $3,000; $6,000, and ($2,000). If the company's ending retained earnings is $10,000 after year 4, what is the average amount of dividends paid per year?

$750.

When treasury stock is resold at a price above cost:

Additional Paid-in Capital is increased.

The disadvantages of the corporate form of business include:

Additional taxes.

When treasury stock is purchased, what is the effect on assets and stockholders' equity?

Assets and stockholders' equity decrease.

Fashion, Inc. had a Retained Earnings balance of $12,000 at December 31, 2015. The company had an average income of $7,500 over the next 3 years, and an ending Retained Earnings balance of $15,000 at December 31, 2016. What was the total amount of dividends paid over the last three years?

Beginning RE + Net income − Dividends = Ending RE. $12,000 + 22,500 ($7,500 x 3) − Dividends = $15,000. Dividends = $19,500.

Which of the following has the highest expected return to the investor?

COMMON STOCK

Preferred stock:

Can have features of both liabilities and stockholders' equity.

The par value of shares issued is normally recorded in the:

Common Stock account.

In terms of total sales, assets, and earnings, the dominant form of business organization is the:

Corporation.

On February 22, Brett Corporation reacquired 200 shares of its $5 par value common stock for $25 each. On March 15, the company reissued 70 shares for $30 each. What is true of the entry for reissuing their shares?

Credit Additional Paid in Capital $350.

A company issued 1,000 shares of $1 par value preferred stock for $5 per share. What is true about the journal entry to record the issuance?

Credit Additional Paid-In Capital $4,000.

South Beach Apparel issued 10,000 shares of $1 par value stock for $5 per share. What is true about the journal entry to record the issuance?

Credit Additional Paid-In Capital $40,000.

Jade Jewelers issued 15,000 shares of $1 par value stock for $20 per share. What is true about the journal entry to record the issuance?

Credit Common Stock $15,000.

On December 2, Coley Corp. reacquired 1,000 shares of its $2 par value common stock for $27 each. On December 20, Coley Corp. reissued 400 shares for $15 each. Which of the following is correct regarding the journal entry for the reissued shares?

Credit Treasury Stock $10,800.

The statement of stockholders' equity shows:

How each equity account changed over time.

Advantages of the corporate form of business include which of the following? I. Double taxation II. Ability to raise capital III. Ability to transfer ownership IV. More paperwork V. Limited liability

II., III., V.

Which of the following stages of equity financing comes last in the traditional order of progression?

IPO

If a company issues 1,000 shares of $1 par value common stock for $20 per share, what would be the effect on the accounting equation?

Increase assets and increase stockholders' equity.

Retained Earnings:

Increases stockholders' equity.

When treasury stock is resold at a gain, the difference between its cost and the cash received when resold:

Increases stockholders' equity.

Outstanding common stock refers to the total number of shares:

Issued less treasury stock.

Advantages of the corporate form that have led to the growth of this form of business ownership include all of the following except:

Low government regulation.

Retained Earnings represent a company's:

Net income less dividends since the company first started

Issued stock refers to the number of shares:

Outstanding plus treasury shares.

The correct order from the smallest number of shares to the largest number of shares is:

Outstanding, issued, and authorized.

Both cash dividends and stock dividends:

Reduce retained earnings.

Outstanding common stock specifically refers to:

Stock in the hands of stockholders.

The Retained Earnings balance reported on the balance sheet typically is not affected by:

Stock splits.

On November 6, Coleman Corp. reacquired 1,000 shares of its $2 par value common stock for $27 each. On November 20, Coleman Corp. reissued 400 shares for $30 each. Which of the following is correct regarding the effect of the journal entry for the reissued shares?

Stockholders' Equity increases.

Which of the following statements about treasury stock transactions is true?

Stockholders' equity is reduced when treasury stock is purchased.

Authorized common stock refers to the total number of shares:

That can be issued.

The stockholders' equity section in the balance sheet shows:

The ending balance in each stockholders' equity account.

The par value of common stock represents:

The legal capital per share of stock assigned when the corporation was first established.

The Common Stock account on a company's balance sheet is measured as:

The number of common shares issued x the stock's par value per share.

Which of the following is a reason that a corporation would prefer to issue stock instead of bonds?

The risk of going bankrupt is less.

How does the stockholders' equity section in the balance sheet differ from the statement of stockholders' equity?

The stockholders' equity section shows balances at a point in time, whereas the statement of stockholders' equity shows activity over a period of time.

Which of the following is not a potential feature of preferred stock?

They all are potential features of preferred stock.

The balance of Retained Earning at the end of the year represents:

Total earnings less payments to owners over the life of the company.

The board of directors of Capstone Inc. declared a $0.60 per share cash dividend on its $1 par common stock. On the date of declaration, there were 50,000 shares authorized, 20,000 shares issued, and 5,000 shares held as treasury stock. What is the entry when the dividends are declared?

div 9k div pay 9k

The board of directors of Capstone Inc. declared a $0.60 per share cash dividend on its $1 par common stock. On the date of declaration, there were 50,000 shares authorized, 20,000 shares issued, and 5,000 shares held as treasury stock. Assuming the dividends were declared on June 1, what is the entry on June 30 to record the payment of cash dividends?

div pay 9k cash 9k

When shares of another corporation are purchased, what is the effect on total stockholders' equity?

no effect

Which of the following accounts is not reported in the stockholders' equity section of the balance sheet?

sales revenue

Common stockholders usually have all of the following rights except:

to articipate i day by day operations

The corporation's own stock that has been issued and then repurchased by the company is referred to as:

treasury stock

The Surf's Up issues 1,000 shares of 6%, $100 par value preferred stock at the beginning of 2014. All remaining shares are common stock. The company was not able to pay dividends in 2014, but plans to pay dividends of $18,000 in 2015. Assuming the preferred stock is cumulative, how much of the $18,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2015?

$12,000 to preferred stockholders and $6,000 to common stockholders.

The ending Retained Earnings balance of Lambert Inc. increased by $1.5 million from the beginning of the year. The company's net income earned during the year is $3.5 million. What is the amount of dividends Lambert Inc. declared and paid?

$2.0 million

Clothing Emporium was organized on January 1, 2015. The firm was authorized to issue 100,000 shares of $5 par value common stock. During 2015, Clothing Emporium had the following transactions relating to shareholders' equity: Issued 30,000 shares of common stock at $7 per share. Issued 20,000 shares of common stock at $8 per share. Reported a net income of $100,000. Paid dividends of $50,000. What is the total amount recorded in the Common Stock account at the end of 2015?

$250,000.

Clothing Emporium was organized on January 1, 2015. The firm was authorized to issue 100,000 shares of $5 par value common stock. During 2015, Clothing Emporium had the following transactions relating to shareholders' equity: Issued 30,000 shares of common stock at $7 per share. Issued 20,000 shares of common stock at $8 per share. Reported a net income of $100,000. Paid dividends of $50,000. What is total paid-in capital at the end of 2015?

$370,000.

California Adventures issues 5,000 shares of 8%, $100 par value preferred stock at the beginning of 2014. All remaining shares are common stock. The company was not able to pay dividends in 2014, but plans to pay dividends of $100,000 in 2015. Assuming the preferred stock is noncumulative, how much of the $100,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2015?

$40,000 to preferred stockholders and $60,000 to common stockholders..

Roberto Designers was organized on January 1, 2015. The firm was authorized to issue 100,000 shares of $5 par value common stock. During 2015, Roberto had the following transactions relating to stockholders' equity: Issued 10,000 shares of common stock at $7 per share. Issued 20,000 shares of common stock at $8 per share. Reported a net income of $100,000. Paid dividends of $50,000. Purchased 3,000 shares of treasury stock at $10 (part of the 20,000 shares issued at $8). What is total stockholders' equity at the end of 2015?

250,000

When a company issues 25,000 shares of $1 par value common stock for $10 per share, the journal entry for this issuance would include:

A credit to Additional Paid-in Capital for $225,000.

Treasury Stock is normally reported as:

A reduction of total stockholders' equity.

Hayes Corporation issues 100 shares of its $1 par value common stock for $15 per share. The entry to record the issuance will not include a:

Debit to Cash $1,500. Credit to Additional Paid-In Capital $1,400. Credit to Common Stock of $100. All of these.

Journal entries to record cash dividends are made on the:

Declaration date and payment date.

What would be the impact on the accounting equation when a company purchases treasury stock?

Decrease assets and decrease stockholders' equity.

Crossroads Mall had 100,000 outstanding shares of common stock. On June 16, 2015, Crossroads repurchased 20,000 shares of its own stock at $30 per share. On July 23, 2015, Crossroads resold 10,000 shares at $28 per share. What net effect did the repurchase and the resell of common stock have on the accounting equation?

Decrease in assets and decrease in stockholders' equity.

When treasury stock is purchased, what is the effect on total stockholders' equity?

Decrease.

Treasury Stock:

Decreases stockholders' equity.

Which of the following statements regarding the corporate form of business is correct?

Disadvantages are that the business is subject to government regulations and double taxation on its income.

Preferred stock is called preferred because it usually has two preferences over common stock. These preferences relate to:

Dividends and distribution of assets if the corporation is dissolved.

Which of the following is TRUE regarding the accounting for treasury stock?

Treasury stock is reported on the balance sheet in the equity section. The purchase and sale of treasury stock has no impact on the income statement. Treasury stock represents a negative equity account. All of these

Which of the following financing alternatives has the highest preference of payment in a case where the company liquidates its assets?

bonds

Which of the following is the most likely to have voting rights?

common stcok