chapter 11 quizzes (Spring 2015, Fall 2018, Spring 2016, Fall 2015, this years quiz)

Common Stock is $10,000, Retained Earnings is $65,000, Additional Paid-in Capital is $20,000, and Treasury Stock is $18,000. What is the total stockholders' equity? a. $113,000 b. $77,000 c. $123,000 d. $87,000

b. $77,000

Melrose Inc. buys back 314,000 shares of its stock from investors at $13.50 a share. Two years later, it reissues this stock for $13.00 a share. The stock reissue would be recorded with a debit to Cash for: a. $4,082,000 million, a debit to Additional Paid-in Capital for $157,000, and a credit to Treasury Stock for $4,239,000 million. b. $4,239,000 million, a credit to Treasury Stock for $4,082,000 million, and a credit to Additional Paid-in Capital for $157,000. c. $4,239,000 million and a credit to Treasury Stock for $4,239,000 million. d. $4,082,000 million and a credit to Treasury Stock for $4,082,000.

a. $4,082,000 million, a debit to Additional Paid-in Capital for $157,000, and a credit to Treasury Stock for $4,239,000 million.

Melrose Inc. buys back 314,000 shares of its stock from investors at $13.50 a share. Two years later, it reissues this stock for $13.00 a share. The stock reissue would be recorded with a debit to Cash for: a. $4,082,000, a debit to Additional Paid-in Capital for $157,000, and a credit to Treasury Stock for $4,239,000 million. b. $4,239,000, a credit to Treasury Stock for $4,082,000, and a credit to Additional Paid-in Capital for $157,000. c. $4,239,000 and a credit to Treasury Stock for $4,239,000. d. $4,082,000 and a credit to Treasury Stock for $4,082,000.

a. $4,082,000, a debit to Additional Paid-in Capital for $157,000, and a credit to Treasury Stock for $4,239,000 million.

Contributed capital totals $30,000, Retained Earnings equals $65,000, Treasury Stock equals $18,000, and Common Stock equals $10,000. If the company does not have any accumulated other comprehensive income (loss), stockholders' equity, what is the total amount of stockholders' equity? a. $77,000 b. $113,000 c. $123,000 d. $87,000

a. $77,000

Contributed capital totals $30,000, Retained Earnings equals $65,000, Treasury Stock equals $18,000, and Common Stock equals $10,000. If the company does not have any accumulated other comprehensive income (loss), what is the total amount of stockholders' equity? a. $77,000 b. $113,000 c. $123,000 d. $87,000

a. $77,000

A corporate charter specifies that the company may sell up to 20 million shares of stock. The company sells 12 million shares to investors and later buys back 3 million shares. The number of authorized shares after these transactions are accounted for is: a. 20 million shares. b. 17 million shares. c. 9 million shares. d. 12 million shares.

a. 20 million shares.

A company declared a $1.00 per share cash dividend. The company has 170,000 shares authorized, 59,000 shares issued, and 56,000 shares of common stock outstanding. What is the journal entry to record the dividend declaration? a. Debit Dividends and credit Dividends Payable for $56,000 b. Debit Dividends and credit Dividends Payable for $59,000 c. Debit Dividends Payable and credit Cash for $59,000 d. Debit Dividends Payable and credit Cash for $170,000

a. Debit Dividends and credit Dividends Payable for $56,000

seville co. issued 700 shares of $52 per value stock for $52,500. what is the total amount of contributed capital? a. $52 b. $52,500 c. 36,400 d. 16,100

b. $52,500

Anthem Inc. issues 200,000 shares of stock with a par value of $0.18 for $167 per share. Three years later, it repurchases these shares for $97 per share. Anthem records the repurchase in which of the following ways? a. Debit Treasury Stock for $19.40 million and credit Cash for $19.40 million b. Debit Common Stock for $36,000, debit Additional Paid-in Capital for $19,364,000 and credit Cash for $19.40 million c. Debit Stockholders' Equity for $33.40 million, credit Additional Paid-in Capital for $19.40 million and credit Cash for $19.40 million d. Debit Common Stock for $36,000, debit Additional Paid-in Capital for $33,364,000 and credit Cash for $33.40 million

a. Debit Treasury Stock for $19.40 million and credit Cash for $19.40 million

advantages of equity financing over debt financing include that a. equity financing does not require repayment b. dividends are tax deductible c. stockholders' control will increase d. dividends are mandatory

a. equity financing does not require repayment

The number of shares outstanding equals the number of shares: a. issued minus the number of shares in treasury. b. authorized minus the number of shares issued. c. issued plus the number of shares in treasury. d. authorized plus the number of shares issued.

a. issued minus the number of shares in treasury.

Just In Thyme, Inc. has the following December 31, 2018 equity balances: Common stock of $20,000; Additional paid-in capital of $30,000; and Retained earnings of $50,000. If Just In Thyme repurchases shares of its stock for $10,000, the total stockholders' equity balance would equal: a. $60,000 b. $90,000 c. $110,000 d. $40,000

b. $90,000

A corporate charter specifies that the company may sell up to 34 million shares of stock. The company sells 26 million shares to investors and later buys back 10.0 million shares. The current number of outstanding shares after these transactions have been accounted for is: a. 8 million shares b. 16 million shares c. 34 million shares d. 17 million shares

b. 16 million shares

the retained earnings balance was $23,700 on January 1. Net income for the year was $19,300. If Retained earnings had a credit balance of $25,400 after closing entries were made for the year, and if additional stock of $6,000 was issued during the year, what was the amount of dividends declared during the year? a. $27,000 b. 17,600 c. 11,600 d. 25,300

b. 17,600

The stockholders' equity section of the balance sheet includes all of the following except: a. Retained Earnings b. Dividends c. Contributed Capital d. Treasury Stock

b. Dividends

On February 16, a company declares a 40¢ dividend to be paid on April 5. There are 2,060,000 shares of common stock issued and outstanding. The entry recorded by the company on February 16 includes a debit to: a. Dividends Payable and a credit to Cash for $781,600. b. Dividends and a credit to Dividends Payable for $824,000. c. Dividends and a credit to Dividends Payable for $781,600. d. Dividends Payable and a credit to Cash for $824,000.

b. Dividends and a credit to Dividends Payable for $824,000.

A company issued 1,400 shares of $66 par value stock for $105,000. What is the total amount of contributed capital? a. $12,600 b. $92,400 c. $105,000 d. $66

c. $105,000

A company issues 1 million shares of common stock with a par value of $0.05 for $15.30 a share. The entry to record this transaction includes a debit to Cash for: a. $50,000 and a credit to Common Stock for $50,000. b. $15,300,000 and a credit to Common Stock for $15,300,000. c. $15,300,000, a credit to Common Stock for $50,000, and a credit to Additional Paid-in Capital for $15,250,000. d. $50,000, a debit to Capital Receivable for $15,250,000, a credit to Common Stock for $50,000, and a credit to Additional Paid-in Capital for $15,250,000.

c. $15,300,000, a credit to Common Stock for $50,000, and a credit to Additional Paid-in Capital for $15,250,000.

A company issues 1 million shares of common stock with a par value of $0.18 for $16.60 a share. The entry to record this transaction includes a debit to Cash for: a. debit to Salaries and Wages Expense for $17,017 $180,000 and a credit to Common Stock for $180,000 b. $16,600,000 and a credit to Common Stock for $16,600,000 c. $16,600,000, a credit to Common Stock for $180,000, and a credit to Additional Paid-in Capital for $16,420,000 d. $180,000, a debit to Capital Receivable for $16,420,000, a credit to Common Stock for $180,000, and a credit to Additional Paid-in Capital for $16,420,000

c. $16,600,000, a credit to Common Stock for $180,000, and a credit to Additional Paid-in Capital for $16,420,000

Contributed capital totals $30,000, Retained Earnings equals $65,000, Treasury Stock equals $18,000, and Common Stock equals $10,000. If the company does not have any accumulated other comprehensive income (loss), what is the total amount of stockholders' equity? a. $113,000 b. $123,000 c. $77,000 d. $87,000

c. $77,000

In an IPO on May 1, 2009, Timmy Hilfigure purchased 1,000 shares of Abner Crummie, Inc. for $5,000. On April 30, 2015, Timmy Hilfigure sold the 1,000 shares for $8,000 to Ralph Loring. What is the effect of the sale on April 30, 2015? a. Abner Crummie, Inc. will record a $3,000 loss. b. Abner Crummie, Inc. will record a $3,000 gain. c. Abner Crummie, Inc. will not be directly affected by this transaction. d. Abner Crummie, Inc. will record a decrease in Cash of $8,000.

c. Abner Crummie, Inc. will not be directly affected by this transaction.

Which of the following is not a reason a company would repurchase stock? a. To reduce the number of outstanding shares. b. To give the impression that the stock is worth buying. c. To have shares of stock to issue when stock options are exercised. d. To increase the total stockholders' equity balance and improve the ROE.

d. To increase the total stockholders' equity balance and improve the ROE.

In an Initial Public Offering on May 1, 2009, Timmy Hilfigure purchased 1,000 shares of Abner Crummie, Inc. for $5,000. On April 30, 2015, Timmy Hilfigure sold the 1,000 shares for $8,000 to Ralph Loring. What is the effect of the sale on April 30, 2015? a. Abner Crummie, Inc. will record a $3,000 loss. b. Abner Crummie, Inc. will record a $3,000 gain. c. Abner Crummie, Inc. will not be directly affected by this transaction. d. Abner Crummie, Inc. will record a decrease in Cash of $8,000.

c. Abner Crummie, Inc. will not be directly affected by this transaction.

General Gills issues 200,000 shares of stock with a par value of $0.15 for $164 per share. Three years later, it repurchases these shares for $94 per share. General Gills records the repurchase in which of the following ways? a. Debit Stockholders' Equity for $32,800,000, credit Additional Paid-in Capital for $14,000,000 and credit Cash for $18,800,000. b. Debit Common Stock for $30,000, debit Additional Paid-in Capital for $18,770,000 and credit Cash for $18,800,000. c. Debit Treasury Stock for $18,800,000 and credit Cash for $18,800,000. d. Debit Common Stock for $30,000, debit Additional Paid-in Capital for $32,770,000 and credit Cash for $32,800,000.

c. Debit Treasury Stock for $18,800,000 and credit Cash for $18,800,000.

Which of the following statements is true? a. The par value of stock is fixed by the federal government and is the same for every company. b. A liability for dividends is recorded on the date of record. c. Outstanding stock includes stock in the hands of investors, but does not include treasury stock in the hands of the corporation. d. Stockholders' equity is the amount the company received for all stock when issued minus the amount of retained earnings and treasury stock.

c. Outstanding stock includes stock in the hands of investors, but does not include treasury stock in the hands of the corporation.

Which of the following statements is false? a. Treasury stock is often used to reward employees as compensation. b. Retained earnings is an equity account. c. The market value and the par value of stock are always equal on the date of issuance. d. Treasury stock is a contra-equity account.

c. The market value and the par value of stock are always equal on the date of issuance.

On April 16, a company declares a 54¢ dividend to be paid on May 5. There are 2,200,000 shares of common stock issued and 120,000 shares of treasury stock. What effect does this declaration have on the accounting equation on the date of declaration? a. Total assets decrease and total liabilities decrease by $1,123,000. b. Total assets decrease and total liabilities decrease by $1,188,000. c. Total liabilities increase and total equity decreases by $1,123,000. d. Total liabilities increase and total equity decreases by $1,188,000. e. No effect on total assets, total liabilities, or total equity.

c. Total liabilities increase and total equity decreases by $1,123,000.

which of the following statements about a corporation is not correct? a. a corporation may have the ability to raise large amounts of capital b. a corporation is a separate legal entity c. a corporation's owners have unlimited liability d. a corporation has easy transferability ownership

c. a corporation's owners have unlimited liability

GE buys back 318,000 shares of its stock from investors at $63 a share. Two years later it reissues this stock for $83 a share. The stock reissue would be recorded as: a. a debit to Cash of $26,394,000 and a credit to Treasury Stock of $26,394,000. b. a debit to Cash of $20,034,000, and a debit to Stockholders' Equity of $6,360,000, a credit to Treasury Stock of $20,034,000, and a credit to Gain on Sale of $6,360,000. c. a debit to Cash of $26,394,000, a credit to Treasury Stock of $20,034,000, and a credit to Additional Paid-in Capital of $6,360,000. d. a debit to Cash of $20,034,000, a debit to Additional Paid-in Capital of $6,360,000, a credit to Treasury Stock of $20,034,000, and a credit to Stockholders' Equity of $6,360,000.

c. a debit to Cash of $26,394,000, a credit to Treasury Stock of $20,034,000, and a credit to Additional Paid-in Capital of $6,360,000.

several years ago, Knox industries issued 200,000 of tis $2 par value stock for a total of $1,600,000. This is the only time that it has sold stock. This year it purchased 2,000 shares of its own stock for $20 a share. As a result of acquiring treasury stock: a. it will recognize a loss of $40,000 b. its retained earnings decrease by $40,000 c. its stock holders equity decreases by $40,000 d. its common stock account decreases by $40,000

c. its stock holders equity decreases by $40,000

If shares of common stock are issued at a market price greater than par value, the amount in excess of par should be credited to: a. Common Stock. b. Treasury Stock. c. Retained Earnings. d. Additional Paid-in Capital.

d. Additional Paid-in Capital.

GE buys back 320,000 shares of its stock from investors at $65 a share. Two years later it reissues this stock for $85 a share. The stock reissue would be recorded with a debit to Cash for: a. a debit to Cash of $27.20 million, a credit to Treasury Stock of $20.80 million, and a credit to Gain on Sale of Treasury Stock for $6.40 million b. a debit to Cash of $20.80 million, a debit to Additional Paid-in Capital of $6.40 million, a credit to Treasury Stock of $20.80 million, and a credit to Stockholders' Equity of $6.40 million c. a debit to Cash of $27.20 million and a credit to Treasury Stock of $27.20 million d. a debit to Cash of $27.20 million, a credit to Treasury Stock of $20.80 million, and a credit to Additional Paid-in Capital of $6.40 million

d. a debit to Cash of $27.20 million, a credit to Treasury Stock of $20.80 million, and a credit to Additional Paid-in Capital of $6.40 million

A company sells 1,000,000 shares of common stock with a par value of $0.18 for $16.60 a share. To record the transaction, the company would: a. debit Cash for $16,600,000 and credit Common Stock for $16,600,000. b. debit Cash for $180,000 and credit Common Stock for $180,000. c. debit Cash for $180,000, debit Contributed Capital for $16,420,000, credit Common Stock for $180,000 and credit Additional Paid-in Capital for $16,420,000. d. Debit Cash for $16,420,000 and credit Additional Paid-in Capital for $16,420,000. e. debit Cash for $1,660,000, credit Common Stock for $180,000 and credit Additional Paid-in Capital for $16,420,000.

e. debit Cash for $1,660,000, credit Common Stock for $180,000 and credit Additional Paid-in Capital for $16,420,000.