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True or False- When bonds are sold at a market price of 105, the cash received f

ID: 2453261 • Letter: T

Question

True or False- When bonds are sold at a market price of 105, the cash received for the bonds is 105 percent of face value.

True or False- A 3-for-2 stock split will triple the reported dollar amount of stockholders' equity.

True or False- When a corporation pays bond interest, Bond Interest Expense is debited.

True or False- On a comparative balance sheet that shows horizontal analysis, the percentage of change in total assets must equal the percentage of change in total liabilities and stockholders' equity.

True or False-Stock is issued to investors at the time they sign the stock subscription contract.

True or False- The salvage value is the value that the asset is expected to have at the end of its useful life.

True or False-When a corporation purchases its own stock and intends to reissue that stock at a later date, the cost of the shares is shown in the Assets section of the balance sheet until the stock is reissued.

True or False- It is customary for a partnership's income statement to show how the net income or loss for the year has been divided between the partners.

True or False-Organization costs are carried indefinitely as an intangible asset in the records of the corporation.

True or False-Before dividends can be paid, they must be declared and voted upon by the shareholders.

True or False-The journal entry to record the division of a partnership profit consists of a debit to each partner's capital account and a credit to Cash.

True or False-Accumulated Depreciation is classified as a contra asset account.

True or False-The Bond Interest Expense account is usually listed under Operating Expenses on the income statement.

True or False-When shares of a corporation's stock are transferred from one investor to another, an entry is recorded in the capital stock transfer journal.

True or False-The book value of an asset is usually the same as the fair market value of the asset.

Explanation / Answer

When bonds are sold at a market price of 105, the cash received for the bonds is 105 percent of face value.- True

A 3-for-2 stock split will triple the reported dollar amount of stockholders' equity.- False

When a corporation pays bond interest, Bond Interest Expense is debited.- True

On a comparative balance sheet that shows horizontal analysis, the percentage of change in total assets must equal the percentage of change in total liabilities and stockholders' equity- True

Stock is issued to investors at the time they sign the stock subscription contract- False

The salvage value is the value that the asset is expected to have at the end of its useful life- True

When a corporation purchases its own stock and intends to reissue that stock at a later date, the cost of the shares is shown in the Assets section of the balance sheet until the stock is reissued-False

It is customary for a partnership's income statement to show how the net income or loss for the year has been divided between the partners- True

Organization costs are carried indefinitely as an intangible asset in the records of the corporation- False.

Before dividends can be paid, they must be declared and voted upon by the shareholders- True.

The journal entry to record the division of a partnership profit consists of a debit to each partner's capital account and a credit to Cash- True

Accumulated Depreciation is classified as a contra asset account- True

The Bond Interest Expense account is usually listed under Operating Expenses on the income statement.-False.

When shares of a corporation's stock are transferred from one investor to another, an entry is recorded in the capital stock transfer journal-False.

The book value of an asset is usually the same as the fair market value of the asset= False

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