Acct Ch 11 Quiz

The date the directors vote to declare and pay a dividend is called the:

Date of declaration.

Hutter Corporation declared a $0.50 per share cash dividend on its common shares. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 shares of common stock outstanding. The journal entry to record the dividend payment is:

Debit Common Dividends Payable $4,000; credit Cash $4,000. Explanation $0.50 × 8,000 shares = $4,000

A company's board of directors votes to declare a cash dividend of $1.00 per share on its 12,000 common shares outstanding. The journal entry to record the declaration of the cash dividend is:

Debit Retained Earnings $12,000; credit Common Dividend Payable $12,000.

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

Earnings per share.

A company issued 60 shares of $100 par value common stock for $7,000 cash. The journal entry to record the issuance is:

Explanation Debit Cash$7,000 Credit Common Stock, $100 Par Value $6,000 Credit Paid-in Capital in Excess of Par Value, Common Stock $1,000

The following data were reported by a corporation: Authorized shares 20,000 Issued shares 15,000 Treasury shares 3,000 The number of outstanding shares is:

Explanation Issued Shares − Treasury Shares = Outstanding Shares 15,000 − 3,000 = 12,000

The following data has been collected about Keller Company's stockholders' equity accounts: Common stock $10 par value 20,000 shares authorized, 10,000 shares issued, and 9,000 shares outstanding$100,000 Paid-in capital in excess of par value, common stock 50,000 Retained earnings 25,000 Treasury stock 11,500 Assuming the treasury shares were all purchased at the same price, the number of shares of treasury stock is:

Explanation Issued shares − Outstanding shares = Treasury shares; 10,000 − 9,000 = 1,000

Prior to June 30, a company has never had any treasury stock transactions. A company repurchased 100 shares of its common stock on June 30 for $40 per share. On July 20, it reissued 50 of these shares at $46 per share. On August 1, it reissued 20 of the shares at $38 per share. What is the balance in the Treasury Stock account on August 2?

Explanation Treasury Stock = # of shares held × initial cost per share(100 − 50 − 20) × $40 = $1,200

Retained earnings:

Generally consists of a company's cumulative net income less any net losses and dividends declared since its inception.

On September 1, Ziegler Corporation had 50,000 shares of $5 par value common stock, and $1,500,000 of retained earnings. On that date, when the market price of the stock is $15 per share, the corporation issues a 2-for-1 stock split. The general journal entry to record this transaction is:

No entry is made for this transaction.

Preferred stock on which the right to receive dividends is forfeited for any year that the dividends are not declared is referred to as:

Noncumulative preferred stock.

A liability for dividends exists:

On the date of declaration.

Preferred stock that allows preferred stockholders to share with common stockholders any dividends paid in excess of the percent or dollar amount stated on the preferred stock is called:

Participating preferred stock.

The total amount of cash and other assets received by a corporation from its stockholders in exchange for its stock is:

Referred to as paid-in capital.

Stock that was reacquired and is still held by the issuing corporation is called:

Treasury stock.