ACC Final Chapter 11

Outstanding stock of the Novak Corporation included 53000 shares of $5 par common stock and 19500 shares of 5%, $10 par non-cumulative preferred stock. In 2019, Novak declared and paid dividends of $7950. In 2020, Novak declared and paid dividends of $26500. How much of the 2020 dividend was distributed to preferred shareholders?

$9750

How is common stock listed in the stockholders' equity section of the balance sheet?

As part of paid-in capital

maximum number of shares a corporation can issue

Authorized shares

Which of the following is the appropriate general journal entry to record the declaration of cash dividends?

Cash Dividends Dividends Payable

otal Stockholders' Equity consists of two sections:

Paid in Capital and Retained Earnings.

Treasury stock is

a corporation's own stock, which has been reacquired and held for future use

The date on which a cash dividend becomes a binding legal obligation is on the

declaration date

The board of directors of Swifty Corporation declared a cash dividend of $1.05 per share on 31000 shares of common stock on July 15, 2020. The dividend is to be paid on August 15, 2020, to stockholders of record on July 31, 2020. The effects of the journal entry to record the declaration of the dividend on July 15, 2020, are to

decrease stockholders' equity and increase liabilities

The cumulative effect of the declaration and payment of a cash dividend on a company's financial statements is to

decrease total assets and stockholders' equity

The acquisition of treasury stock by a corporation

decreases its total assets and total stockholders' equity

On the dividend record date,

no entry is required

Regular dividends are declared out of

retained earnings

Outstanding stock of the Bramble Corp. included 42000 shares of $5 par common stock and 20000 shares of 5%, $10 par non-cumulative preferred stock. In 2019, Bramble declared and paid dividends of $8400. In 2020, Bramble declared and paid dividends of $25200. How much of the 2020 dividend was distributed to preferred shareholders?

$10000

Pina Colada Corp. has 1350 shares of 12%, $100 par value, cumulative preferred stock and 67500 shares of $1 par value common stock outstanding at December 31, 2020. What is the annual dividend on the preferred stock?

$16200 in total

In the stockholders' equity section of the balance sheet, from what is the cost of treasury stock deducted?

Total paid-in capital and retained earnings

Dividends in arrears are dividends on

cumulative preferred stock that have not been declared for a given period of time