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Study Resources (Accounting)

11) Which of the following will happen to a stockholder's percentage ownership in the stock of a corporation when the corporation declares a stock dividend? A) The stockholder's percentage ownership decreases. B) The stockholder's percentage ownership can increase or decrease. C) The stockholder's percentage ownership increases. D) The stockholder's percentage ownership stays the same. 12).
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Learning Objective 12-2 1) Different classes and types of stock carry different degrees of risk for the shareholder. 2) Corporations must issue common stock, but may or may not decide to issue preferred stock. 3) All forms and classes of stock carry voting rights. 4) Every corporation issues preferred stock. 5) Paid-in capital is equity.
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31) Bradley Corporation issued 10,000 shares of common stock on January 1, 2013.  The stock has par value of $0.01 per share and was sold at par.  Please provide the journal entry for this transaction. 32) Bradley Corporation issued 10,000 shares of common stock on January 1, 2013.  The stock has.
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11) Which of the following occurs when a shareholder invests cash in a corporation in exchange for stock? A) Both liabilities and stockholders' equity are increased. B) Both assets and stockholders' equity are increased. C) One asset is increased and another asset is decreased. D) Both assets and liabilities are increased. 12) The following information.
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21) Landess Corporation currently has 120,000 shares outstanding of $1 par value common stock.  The stock was originally issued for $12 per share.  On March 15, the board of directors declares a 10% stock dividend when the stock is selling for $16 per share.  Which of the following is the.
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Learning Objective 12-9 1) Which one of the following describes financial leverage? A) To pay off all long-term debt in order to reduce interest expense B) To finance with equity capital C) To offer discounts to customers for early payment of invoices D) To earn more income on borrowed money than the related interest expense 2).
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Learning Objective 10-3 1) Gross pay is the total amount of salary, wages, commissions, and bonuses earned by an employee during a pay period. 2) The old age, survivors, and disability insurance portion of FICA taxes is imposed on all of an individual employee's earnings. 3) Payroll tax expense includes the employer's.
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36) Peterson Company issued 4,000 shares of preferred stock for $240,000.  The stock has a par value of $60 per share.  Please provide the journal entry for this transaction. 37) Lerner Company had the following transactions in 2013, its first year of operations. •Issued 20,000 shares of common stock.  Stock has par.
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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 12-3 1) When a corporation sells 10,000 shares of $10 par value common stock for $120,000, the Common stock account is credited for $100,000. 2) Stock sold for amounts in excess of par value results in a gain reported on the income statement. 3) The stock of publicly owned corporations is.
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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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Learning Objective 12-8 1) Normally, a company's book income and tax income should be the same. 2) Deferred tax can either be an asset or a liability. 3) Origami Company is considering a new project and needs to raise $800,000 of capital.  Their after-tax net income would be $75,000 if they do not.
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11) Internal controls over payroll focus on operational efficiency and safeguarding of payroll disbursements. 12) Dan Jones and Pat Smith are the only two employees of Lone Star Company.  In January, 2012, Dan's gross pay was $4,400 and Pat's gross pay was $5,200.  All earnings are subject to FICA taxes of.
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Learning Objective 11-5 1) The time value of money is based on the concept that money earns interest over time. 2) Rules of GAAP require that bond premiums or discounts be amortized using the straight-line method. 3) If the difference between the effective-interest method of amortizing bond discount and the straight-line method.
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11) Hot Tamale Company had $120,000 of revenues and $125,000 of expenses. No dividends were paid.  The second of the year-end closing entries should include which of the following line items? A) Credit Retained earnings $125,000. B) Debit Retained earnings $125,000. C) Debit Income summary $125,000. D) Credit Income summary $125,000. 12) Hot Tamale Company.
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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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  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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21) Peterson Company issued 4,000 shares of preferred stock for $240,000.  The stock has a par value of $60 per share.  The journal entry to record this transaction would: A) credit Cash $240,000, debit Common stock $4,000, and debit Paid-in capital $236,000. B) debit Cash $240,000, credit Common stock $4,000, and credit.
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Learning Objective 12-4 1) When a company records the year-end closing entries, the first step is to close the Revenues to Retained earnings. 2) When a company records the year-end closing entries, the Income summary balance, before it is closed to Retained earnings, should be equal to the Net income or Net.
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31) Landess Corporation currently has 120,000 shares outstanding of $1 par value common stock.  The stock was originally issued for $12 per share.  On March 15, the board of directors declares a 10% stock dividend when the stock is selling for $16 per share.  Prepare the journal entry to record.
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11) Which of the following represents one of the basic rights of stockholders? A) Stockholders can maintain their proportionate ownership if the corporation issues new stock. B) Stockholders may sell their stock back to the company if they wish. C) Stockholders may authorize a business contract on behalf of the corporation. D) Stockholders may.
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Learning Objective 12-5 1) Declaring and paying dividends causes a decrease in both assets and equity. 2) Paying dividends causes a decrease in total paid-in capital. 3) If preferred stock is non-cumulative, then the company does NOT need to pay dividends that were passed in previous years. 4) If preferred stock is cumulative, then.
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