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Exam 11: Accounting for Equity

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Question 31

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_____________ is the amount of income earned per share of a company's outstanding common stock.

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Question 32

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_______________________________ is the total amount of cash and other assets received by the corporation from its stockholders in exchange for common stock.

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Question 33

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Minimum legal capital requirements often prohibit dividends when the dividends reduce stockholders' equity below the minimum specified amount.

What are the rights generally granted to common stockholders?

A proxy is:

The following data has been collected about a company's stockholders' equity accounts: $\begin{array}{|l|r|}\hline \text { Common stock } \$ 10 \text { par value } 20,000 \text { shares authorized and } 10,000 \text { shares issued } & \$ 100,000 \\\hline \text { Contributed capital in excess of par value, common stock } & 50,000 \\\hline \text { Retained earnings } & 25,000 \\\hline \text { Treasury stock, } 1,000 \text { shares } & 11,500 \\\hline\end{array}$ The treasury shares were all purchased at the same price. The cost per share of the treasury stock is:

When a company declares cash dividends, retained earnings is reduced.

A corporation issued 6,000 shares of its $10 par value common stock in exchange for land that has a market value of $84,000. The entry to record this transaction would include:

A stock dividend transfers:

A company was organized in January 2012 and has 2,000 shares of $100 par value, 10%, nonparticipating preferred stock outstanding and 30,000 shares of $10 par value common stock outstanding. It has declared and paid cash dividends each year as shown below. Calculate the total dividends distributed to each class of stockholder under each of the assumptions given.

Common stock always carries a preference for receiving dividends over preferred stock.

Match the following definitions to their terms

On August 31, 2013, Gilliam Corporation's common stock is priced at $50 per share before any stock dividend, and the stockholders' equity section of its balance sheet appears as follows. Assume that the company declares and immediately distributes a 35% stock dividend. What is the total amount in the Retained Earnings account immediately after the stock dividend?

The statement of changes in stockholders' equity:

Prior period adjustments are reported in the:

The price-earnings ratio reveals information about the stock market's expectations for a company's future growth in earnings, dividends, and economic opportunities.

The right of common shareholders to protect their proportionate interest in a corporation by having the first opportunity to buy additional proportionate shares of common stock issued by the corporation is called a:

_________________ is a corporation's own stock that has been reacquired.

A company reported earnings per share of $9.75, paid a $6.00 cash dividend per share to preferred shareholders, and paid a $0.54 cash dividend per share to common shareholders. There were 1,000 shares of preferred stock outstanding and 6,000 shares of common stock outstanding during the year and the market price per share of common stock was $45. Calculate the company's dividend yield for common stock.

A company sold stock for $733,000. The shares had a par value of $6.26 each. After the transaction, the paid-in capital in excess of par common stock account had a balance of $420,000. How many shares did the company sell?