Era Company has 3,000 shares of 5%, $100 par non-cumulative preferred stock outstanding at December 31, 2013. No dividends have been paid on this stock for 2012 or 2013. Dividends in arrears at December 31, 2013 total
a. $0.
b. $15,000.
c. $30,000.
d. $1,500.
Last Inc., has 2,000 shares of 6%, $50 par value, cumulative preferred stock and 100,000 shares of $1 par value common stock outstanding at December 31, 2013, and December 31, 2012. The board of directors declared and paid a $5,000 dividend in 2012. In 2013, $24,000 of dividends are declared and paid. What are the dividends received by the preferred stockholders in 2013?
a. $6,000
b. $17,000
c. $12,000
d. $7,000
Each of the following is reported for common stock except the
a. shares issued.
b. liquidation value.
c. shares outstanding.
d. par value.
Stock dividends and stock splits have the following effects on retained earnings:
Stock split Stock Dividends
a. Increase No change
b. No change No change
c. No change Decrease
d. Decrease Decrease
Adams Corporation began business by issuing 300,000 shares of $5 par value common stock for $24 per share. During its first year, the corporation sustained a net loss of $30,000. The year-end balance sheet would show
a. Common stock of $1,500,000.
b. Common stock of $7,200,000.
c. Total paid-in capital of $7,170,000.
d. Total paid-in capital of $5,700,000.
Retained earnings are occasionally restricted
a. if preferred dividends are in arrears.
b. due to contractual loan restrictions.
c. to set aside cash for dividends.
d. to keep the legal capital associated with paid-in capital intact
New Corp. issues 2,000 shares of $10 par value common stock at $14 per share. When the transaction is recorded, credits are made to
a. Common Stock $20,000 and Paid-in Capital in Excess of Stated Value $8,000.
b. Common Stock $20,000 and Paid-in Capital in Excess of Par $8,000.
c. Common Stock $20,000 and Retained Earnings $8,000.
d. Common Stock $28,000.
If a stockholder cannot attend a stockholder’s meeting, he may delegate his voting rights by means of
a. a certified letter.
b. a telegram.
c. an absentee ballot.
d. a proxy.
If a corporation has only one class of stock, it is referred to as
a. classless stock.
b. preferred stock.
c. solitary stock.
d. common stock
A corporate board of directors does not generally
a. declare dividends.
b. execute policy.
c. select officers.
d. formulate operating policies.
A prior period adjustment that corrects income of a prior period requires that an entry be made to
a. the retained earnings account.
b. a current year revenue or expense account.
c. an asset account.
d. an income statement account.
Evergreen Manufacturing Corporation purchased 4,000 shares of its own previously issued $10 par common stock for $92,000. As a result of this event,
a. Evergreens Common Stock account decreased $40,000.
b. Evergreens total stockholders equity decreased $92,000.
c. Evergreens Paid-in Capital in Excess of Par account decreased $52,000.
d. All of these.
Under IFRS, the term reserves relates to each of the following except
a. contributed (paid-in) capital.
b. fair value differences.
c. retained earnings.
d. asset revaluations
A net loss
a. occurs if operating expenses exceed cost of goods sold.
b. is closed to the paid-in capital account of the stockholders’ equity section of the balance sheet.
c. is not closed to Retained Earnings if it would result in a debit balance.
d. is closed to Retained Earnings even if it would result in a debit balance.
Of the various dividends types, the two most common types in practice are
a. cash and large stock.
b. cash and property.
c. cash and small stock.
d. property and small stock
