QUESTION 1 Which one of the following would not be considered an advantage of th

Question

QUESTION 1 Which one of the following would not be considered an advantage of the corporate form of organization? a. Linited liability of owners O b. Separate legal existence c Continuous life d Government regulation QUESTION 2 Which one of the following is not an ownership right of a stockholder in a corporation? O a. To vote in the election of directors O b. To declare dividends on the common stock To share in assets upon liquidation To share in corporate earnings c, Od. QUESTION 3 Dividends are declared out of a Capital Stock b Paid-in Capital in Excess of Par c Retained Eamings d. Treasury Stock

Explanation / Answer

1.D government regulation isnot an advantage

The advantages of corporations are limited liability,seperate legal existence and perpetual existence

2.Answer:B

share holders has the right to recommend diidends but right to declare dividends with drectors

3.Answer:C

Dividends are declared out of retained earnings.The retained earnings is an account of equity that shows the net balance of company's earnings

4.Answer c

the paid up capital in excess of par value credited for $240000(280000-8000*5)

5.Answer:c

if common stock is issued for an amount greater than par value the excess amount should be credited to paid up capital in excess of par value

6.Answer A

7.Answer c

If common stock is issued in excess of par value then credit to common stock and paid up capital in excess of par

value

8.Answer:A

9.Answer D

10.Answer B

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