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27) Which of the following is pay stated as a percentage of a sale amount? A) Bonuses B) Benefits C) Wages D) Commissions 28) Which of the following are deducted in arriving at an employee's net pay? A) Federal income taxes B) FICA taxes—employer's portion C) Federal unemployment taxes D) State unemployment taxes 29) Which of the following deductions must.
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3) If the difference between the effective-interest method of amortizing bond discount and the straight-line method is immaterial, then GAAP permits use of the straight-line method. 4) The time value of money is related to which of the following concepts? A) Money loses value over time as it is spent. B) Money earns.
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25) Occidental Produce Company has 40,000 shares of common stock outstanding and 2,000 shares of preferred stock outstanding.  The common stock is $0.01 par value; the preferred stock is 4% non-cumulative, with $100 par value.  On October 15, 2014, the company declares a total dividend payment of $40,000.  What is.
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6) Please refer to the equity section of the balance sheet, below:   Common stock, $0.01 par $500       1,000,000 shares authorized, 50,000 shares outstanding Paid-in capital in excess of par 399,500 Retained earnings 150,000      Total stockholders' equity $550,000 Please calculate the book value per share of common stock. A) $3.00 per share B) $8.00 per share C) $11.00.
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23) Hot Tamale Company had $120,000 of Revenues and $125,000 of Expenses. No dividends were paid.  Please provide the first of the year-end closing entries. 24) Hot Tamale Company had $120,000 of Revenues and $125,000 of Expenses. No dividends were paid.  Please provide the second of the year-end closing entries. 25) Hot.
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15) Which of the following occurs when a dividend is declared? A) Liabilities increase. B) Equity increases. C) Liabilities decrease. D) Assets increase. 16) Which of the following is TRUE of dividends in arrears? A) Dividends in arrears are a liability on the balance sheet. B) Dividends in arrears are passed dividends on noncumulative preferred stock. C) Dividends.
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Learning Objective 11-4 1) Interest payable would normally be shown on the balance sheet in current liabilities. 2) FICA tax payable would normally be shown on the balance sheet in long-term liabilities. 3) Accounts payable is always shown on the balance sheet in current liabilities. 4) The current portion of notes payable would.
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5) Which of the following shows the relationship between net income available to common shareholders and average common equity? A) Net income B) The rate of return on total assets C) Inventory turnover D) The rate of return on common stockholders' equity 6) The rate of return on total assets and the rate of return.
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17) The reason people buy bonds is to: A) earn interest. B) reduce their income taxes. C) save money. D) receive dividend payments. 18) The interest rate on which cash payments to bondholders are based is the: A) market rate. B) discount rate. C) stated rate. D) amortization rate. 19) Which of the following describes a term bond? A) A bond.
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Learning Objective 11-1 1) The current portion of notes payable is the principal amount that will be paid within one year of the balance sheet date. 2) The current portion of notes payable must be reported on the balance sheet combined with the long-term portion under long-term liabilities. 3) When a long-term.
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Learning Objective 12-1 1) The formation of a corporation is generally less complicated than the formation of a partnership. 2) A corporation is a separate legal entity formed under the laws of a particular state. 3) Stockholders of a corporation have unlimited liability for the corporation's debt. 4) A disadvantage of the corporation is.
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16) Which of the following describes preferred stock? A) Stock that sells for a very high price B) Stock that is sold to employees of the company as a performance incentive C) Stock that is purchased by the corporation for investment purposes D) Stock which gives shareholders certain preferences and advantages over common stock 17).
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Learning Objective 13-1 1) Stock dividends have no effect on assets or liabilities. 2) Cash dividends affect only stockholders' equity accounts. 3) Stock dividends are distributed to stockholders in proportion to the number of shares each stockholder already owns. 4) The declaration of a stock dividend creates a liability for the corporation. 5) On June.
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40) Overton Company had the following transactions in 2013, its first year of operations. •Issued 5,000 shares of common stock.  Stock has par value of $0.01 per share and was issued at $30.00 per share. •Earned net income of $200,000. •Paid dividends of $5.00 per share. The company charter authorizes 1,000,000 shares of common.
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33) Chaney Corporation issued 20,000 shares of common stock on January 1, 2014.  The stock has par value of $1.00 per share and was sold at $30 per share.  Please provide the journal entry for this transaction. 34) Dallkin Corporation issued 5,000 shares of common stock on January 1, 2015.  The.
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16) Please refer to the equity section of the balance sheet shown below: Preferred stock $100 par, 10,000 shares authorized, 1,000 shares issued $100,000 Common stock $1 par, 500,000 shares authorized, 20,000 shares issued 20,000 Paid-in capital in excess of par 350,000 Retained earnings (74,000) Total stockholders' equity $396,000 The amount shown for Retained earnings would be called a(n): A).
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38) Franconia Sales offers warranties on all their electronic goods.  Warranty expense is estimated at 2% of sales revenue.  In 2013, Franconia had $500,000 of sales.  In the same year, Franconia paid out $7,500 of warranty payments.  Please provide the journal entry to record the warranty expense. 39) Franconia Sales offers.
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25) Moretown Company had the following transactions in 2014, its first year of operations. •Issued 30,000 shares of common stock.  Stock has par value of $1.00 per share and was issued at $18.00 per share. •Earned net income of $70,000. •Paid no dividends. At the end of 2014, what is the total amount of.
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6) Which of the following describes the correct sequence of year-end closing entries? A) Close Revenues to Income summary; close Expenses to Income summary; close Income summary to Retained earnings. B) Close Expenses to Income summary; close Revenues to Income summary; close Income summary to Retained earnings. C) Close Revenues to Income summary;.
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38) Moretown Company had the following transactions in 2013, its first year of operations. •Issued 30,000 shares of common stock.  Stock has par value of $1.00 per share and was issued at $18.00 per share. •Earned net income of $70,000. •Paid no dividends. The company charter authorizes 1,000,000 shares of common stock and 100,000.
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6) Retained earnings is equity that is generated internally by corporate business transactions. 7) All corporations must issue both common and preferred shares of stock. 8) Which of the following represents one of the basic rights of stockholders? A) Stockholders may sell their stock back to the company if they wish. B) Stockholders may.
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11) Which of the following corporate characteristics is a disadvantage of the corporate form of business? A) Limited liability B) Double taxation C) No mutual agency D) Transferability of ownership 12) Which of the following is a disadvantage of the corporate form of business? A) Separation of ownership and management B) Continuous life C) The potential to raise.
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