Chapter 10

par value

what is the value that determines an entity's legal capital?

assets and stockholders equity increase

when a company issues common stock for cash....

contra equity

the treasury account is a(n) ________ ____________ account

maximum number of shares that can be issued for each class of stock.

Authorized stock represents the

B

Issued shares represent the a. maximum number of shares that can be sold by the corporation. b. number of shares that the corporation has sold. c. number of shares that are currently held by stockholders. d. number of previously issued shares that have been repurchased by the corporation.

true

T/F: Both stock dividends and stock splits increase the number of a corporation's outstanding shares without altering the proportionate ownership of the corporation.

true

T/F: Comprehensive income represents the increase in net assets resulting from all transactions occurring during the accounting period except transactions with owners.

true

T/F: In general, retained earnings represents accumulated earnings of the corporation less dividends paid.

balance sheet and the statement of cash flows

cash is reported on what two financial statements

number of shares that are currently held by stockholders.

Outstanding shares represent the

false

T/F: Since stock dividends are paid with shares of stock instead of cash, no reduction in Retained Earnings is recorded.

true

T/F: Treasury stock is reported as a reduction of stockholders' equity.

true

T/F: When a corporation declares a dividend, a liability must be recorded.

true

T/F: shareholders in common stock have voting privileges, while shareholders in preferred stock do not

number of previously issued shares that have been repurchased by the corporation.

Treasury shares represent the

dividend

a distribution of profits to owners by a corporation is known as

paid-in capital

amounts exchanged for ownership in a corporation

higher

outstanding checks cause the bank balance to be __________ than the business's cash account balance

issued shares- treasury stock

outstanding shares=

cumulative preferred stockholders

receive current year dividend plus any dividends in arrears

treasury stock

repurchases of previously issued stock is known as the purchase of

B

the 3 key cash controls does not include a. bank reconciliation b. purchase of stocks and bonds c. cash over and short d. petty cash funds