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Exam 11: Corporate Reporting and Analysis

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Question 61

Multiple Choice

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Djarleen Company has 10,000 shares of $10 par preferred stock. It also has 250,000 shares of common stock outstanding, and its total stockholders' equity equals $4,000,000. The book value per common share is:

A) $16.67.
B) $16.00.
C) $40.00.
D) $15.60.
E) $10.00.

F) A) and B)
G) D) and E)

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Question 62

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Book value per share reflects the value per share if a company is liquidated at balance sheet amounts.

A) True
B) False

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Question 63

Multiple Choice

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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:

Prior to May 1, Fortune Company has never had any treasury stock transactions. A company repurchased 100 shares of its common stock on May 1 for $5,000. On July 1, it reissued 50 of these shares at $52 per share. On August 1, it reissued the remaining treasury shares at $49 per share. What is the balance in the Paid-in Capital, Treasury Stock account on August 2?

A stock _________________ keeps stockholder records and prepares official lists of stockholders for stockholder meetings and dividend payments.

Eastline Corporation had 10,000 shares of $10 par value common stock outstanding when the board of directors declared a stock dividend of 3,000 shares. At the time of the stock dividend, the market value per share was $12. The entry to record this dividend is:

The least amount that the buyers of stock must contribute to the corporation or be subject to paying at a future date is called ____________________________.

Parlay Corporation has 2,000,000 shares of $0.50 par value common stock outstanding. The following selected transactions related to the company's stock took place during the current year: Apr. 15 Declared a 40% stock dividend to stockholders of record on May 1, to be issued May 10. The current market value is $15 per common share. Prepare necessary journal entries to record the events of April 15, May 1 and May 10.

A preemptive right means shareholders can purchase their proportional share of common stock issued later by the corporation.

Participating preferred stock has a feature that allows its holders to share with common shareholders in any dividends paid in excess of the percent or dollar amount stated on the preferred stock.

If a corporation receives assets other than cash in exchange for stock, it records the assets received at their market value as of the date of the transaction.

A corporation paid a cash dividend of $0.85 per share during the current year. It had 1,550,000 common shares outstanding at year-end, its current year earnings per share was $3.45, and the stock's year-end market price was $10.63 per share. Calculate the company's dividend yield.

The amount assigned per share to stock by the corporation in its charter is the _____________________.

A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share. The entry to record this transaction would be:

Which of the following is true of a stock dividend?

If a corporation is authorized to issue 1,000 shares of $5 common stock, it is said to have $5,000 of stock outstanding.

Common shareholders always share equally with all other shareholders in dividends.

A company issued 60 shares of $100 par value common stock for $7,000 cash. The total amount of paid-in capital in excess of par is:

When no-par stock is not assigned a stated value, the total amount received is recorded in the Common Stock account.

A corporation may be authorized to issue both common and preferred stock.