accounting test

Zinc, Inc. has 10,000 shares of $5 par, 5% preferred stock, and 5,000 shares of $10 par common stock issued and outstanding. If the board of directors authorizes a $15,000 dividend, the payments to preferred shareholders will total Blank______.

$2,500

Blink, Inc. has 1,000 shares of $10 par, 5% preferred stock, and 20,000 shares of $10 par common stock issued and outstanding. If the board of directors authorizes a $20,000 dividend, the payment to common shareholders will total $______.

19,500

A small stock dividend is a distribution of Blank______% or less of previously outstanding shares.

25

______ stock is the number of shares that a corporation's charter allows it to sell.

Authorized

John Kim agrees to contribute equipment with a fair market value of $5,000 in exchange for 100 shares of Rio Inc.'s common stock with a par value of $1 per share. Rio will record this transaction as a credit to which of the following accounts? Multiple select question.

Common Stock Paid-in Capital in Excess of Par Value

Vanya Inc.'s charter authorizes 1,000 shares of stock at a stated value of $1 per share. Vanya sells 50 shares of stock at its initial offering for $10 per share. The journal entry to record this transaction will include which of the following entries?

Credit to Common Stock for $50. Debit to Cash for $500. Credit to Paid-In Capital, in Excess of Stated Value for $450.

Gomez Inc.'s charter authorizes 1,000 shares of stock at a par value of $1 per share. Gomez sells 200 shares of stock at its initial offering for $1 per share. The journal entry to record this transaction will include which of the following entries?

Credit to Common Stock, $1 par for $200. Debit to Cash for $200.

Ivers, Inc. purchased 100 shares of its own $10 par value common stock for $20 per share. The journal entry to record this transaction would include which of the following entries?

Debit to Treasury Stock; credit to Cash.

Identify the advantages of the corporate form of business

Ease of capital accumulation Continuous life Limited liability of stockholders

Identify which of the following is not generally a right of common stockholders.

Manage operations

Jose Garcia agrees to contribute land with a fair market value of $10,000 in exchange for 200 shares of Damian Inc.'s common stock with a par value of $10 per share. The journal entry to record this transaction in the books of Damian, Inc., will include a credit to ______ in the amount of ______.

Paid-in Capital, in Excess of Par; $8,000

______ has/have special rights that give it priority over other types of stock in one or more areas.

Preferred stock

The account that consists of a company's cumulative net income less any losses and dividends declared since its inception is called ______.

Retained Earnings

Which of the following is not a reason that a corporation would issue preferred stock?

To obtain a tax advantage over corporations with no preferred stock

Corporations purchase and hold their own stock, known as treasury stock, for several reasons. Identify which of the following is not a reason that a corporation would buy treasury stock.

To reduce the market value of the common shares outstanding

Niren, Inc.'s charter authorizes 1,000,000 shares of stock at a par value of $1 per share. Niren sells 100 shares of stock at its initial offering for $1 per share. The journal entry to record this transaction will include a (debit/credit) to Common Stock, $1 par for $(blank).

credit, 100

On August 20, Max, Inc. issues 100 shares of $1 par value preferred stock for $3,000 cash. The entry to record this transaction would include a (debit/credit) to the preferred stock account in the amount of $______.

credit, 100

Avery, Inc. held 100 shares of its own $10 par value common stock purchased for $15 per share. On December 1, Avery sold 10 shares at $15 per share. The journal entry to record the sale of treasury stock would include a (debit/credit) to Treasury Stock in the amount of $_______

credit, 150

Josie Inc.'s charter authorizes 1,000 shares of stock with no par value. Josie Inc. sells 100 shares of stock at its initial offering for $5 per share. The journal entry to record this transaction will include a (debit/credit) to Common Stock, for $ (blank).

credit, 500

Riley Inc.'s charter authorizes 1,000 shares of stock at a stated value of $10 per share. Riley issues 50 shares of stock at its initial offering for $20 per share. The journal entry to record this transaction will include a (debit/credit) to Common Stock, $(blank).

credit, 500

On May 25, Tyler, Inc. issues 100 shares of $10 par value preferred stock for $5,000 cash. The entry to record this transaction would include a (debit/credit)______ to the preferred stock account in the amount of ______.

credit; $1,000

Cameron, Inc. held 1,000 shares of its own $10 par value common stock purchased for $20 per share. In March, Cameron sold 10 shares at $20 per share. The journal entry to record the sale of treasury stock would include a (debit/credit) Blank______ to Treasury Stock in the amount of Blank______.

credit; $200

Dane, Inc. purchased 10 shares of its own $5 par value common stock for $20 per share. The journal entry to record this transaction would include a (debit/credit) to the Treasury Stock account in the amount of $____.

debit, 200

The board of directors authorizes a cash ______ or distribution of cash to its investors.

dividend

The amount of income earned per each share of a company's outstanding common stock is known as:

earnings per share

The ______ value per share is the price at which a stock is bought an

market

The market value per share is the price at which stock is bought and sold. Which of the following factors does not influence market value?

par value

Stock that typically includes preference for receiving dividends and for distribution of corporate assets during a liquidation is called (common/preferred) _ stock.

preferred

A stock ______ is the distribution of additional shares to stockholders according to their percent ownership. When this occurs, the corporation "calls in" its outstanding shares and issues more than one new share in exchange for each old share.

split

The board of directors of Visor, Inc. authorize a Blank______, a distribution of additional shares of the corporation's own stock, to existing shareholders.

stock dividend

Two of the biggest disadvantages of the corporate form of business are government regulation and corporate (blank)

taxation or tax or taxes

Keys, Inc. purchased 100 shares of its own common stock for $10 per share. The stock is now classified as Blank______ stock, a contra equity account, reported on the statement of stockholder's equity.

treasury

Preferred stock can be issued to raise money without giving up control

true

Stockholders do not have the power to bind the corporation to contracts. This is referred to as lack of mutual agency. True false question.

true

Stockholders have the right to _____ at stockholders' meetings.

vote

In the computation of basic earnings per share, a company will use the _____

weighted-average common shares outstanding

(blank) stock is the number of shares that a corporation's charter allows it to sell. The number of these shares usually exceeds the number of shares issued (and outstanding), often by a large amount.

authorized

Corporations can be separated into two types. A (privately/publicly) held corporation does not offer its stock for public sale and usually has few stockholders. A (privately/publicly) held corporation offers its stock for public sale and can have thousands of stockholders.

privately, publicly

A charter application usually must be signed by the prospective stockholders called incorporaters or (blank) . Then, it is filed with the appropriate state official.

promoters

_____ ______ is an account that consists of a company's cumulative net income less any losses and dividends declared since its inception.

retained earnings

Carefree, Inc. has 20,000 shares issued and outstanding. On August 1, the board authorizes a 20% stock dividend. This is considered a (large/small) stock dividend.

small

Mario, Inc. declares a 2-for-1 stock ______ . This means that Mario will "call in" its outstanding shares and issue two shares in exchange for each old share of stock.

split

The ______ lists the beginning and ending balances of key equity accounts and describes the changes that occur during the period.

statement of stockholders' equity

A ______ dividend, declared by a corporation's directors, is a distribution of additional shares of the corporation's own stock.

stock

Select all that apply A statement of stockholders' equity lists balances of:

cash dividends common stock shares net income retained earnings

Bing Inc.'s charter authorizes 500 shares of stock with no par value. Bing Inc. sells 100 shares of stock at its initial offering for $5 per share. The journal entry to record this transaction will include a (debit/credit) ______ to Common Stock for _____

credit; $500