Dolly’s Best issued 200 shares of its $10 common stock in exchange for used pack
ID: 2486611 • Letter: D
Question
Dolly’s Best issued 200 shares of its $10 common stock in exchange for used packaging equipment with a fair market value of $2,400. The entry to record the acquisition of the equipment would include a
debit to Equipment for $2,000.
B. debit to Paid-In Capital in Excess of Par for $400.
C. credit to Common Stock for $2,400.
D. debit to Equipment for $2,400.
2.
Question 2 of 20
Custer.com’s outstanding stock is 100 shares of $100, 6% cumulative nonparticipating preferred stock, and 1,000 shares of $10 par value common stock. Custer paid $2,000 cash dividends, including one-year dividends in arrears to preferred stockholders. Common stockholders received
A. $0.
B. $800.
C. $1,818.
D. $600.
Question 3 of 20
Sunrise Online issued 500 shares of its $10 common stock in exchange for equipment with a fair market value of $7,500. The entry to record the transaction would include a
A. debit to Equipment for $5,000.
B. debit to Common Stock for $5,000.
C. credit to Paid-In Capital in Excess of Par Value for $2,500.
D. credit to Common Stock Subscribed for $5,000.
Question 4 of 20
Washington Corporation issued 4,000 shares of its $20 par value common stock for $23 per share. The entry to record the issuance would include a
A. debit to Cash for $80,000.
B. credit to Common Stock for $12,000.
C. credit to Common Stock for $80,000.
D. debit to Paid-In Capital in Excess of Par Value for $12,000.
Question 5 of 20
The Logan Company issued 140 shares of its $12 par value stock for $14 per share. The entry to record the receipt of cash and issuance of the stock would include a
A. debit to Cash for $1,680 and a credit to Common Stock for $1,680.
B. debit to Cash for $1,960.
C. credit to Common Stock for $1,960.
D. debit to Discount on Common Stock for $280.
Dividends in arrears occur when the company doesn’t pay dividends to
A. cumulative preferred stockholders.
B. noncumulative preferred stockholders.
C. participating preferred stockholders.
D. nonparticipating common stockholders.
Question 7 of 20
Officers of the corporation are
A. appointed by the stockholders.
B. stockholders of the corporation.
C. appointed by the board of directors.
Question 8 of 20
A. The stockholders have limited liability.
B. When stockholders sell their shares, the corporation is dissolved.
C. A corporation cannot own property in its name.
D. Cash dividends to the stockholders are nontaxable.
Question 9 of 20
Preferred stock that’s given a right to share with the common stock in dividends in excess of a stated preferred dividend rate is called
A. nonparticipating.
B. participating.
C. cumulative.
D. noncumulative.
hubarb Corporation’s outstanding stock is 100 shares of $100, 11% cumulative nonparticipating preferred stock, and 2,000 shares of $12 par value common stock. Rhubarb paid $1,600 cash dividends during the year. Common stockholders received
A. $0.
B. $500.
C. $2,500.
D. $1,100.
debit to Equipment for $2,000.
B. debit to Paid-In Capital in Excess of Par for $400.
C. credit to Common Stock for $2,400.
D. debit to Equipment for $2,400.
2.
Question 2 of 20
5.0 PointsCuster.com’s outstanding stock is 100 shares of $100, 6% cumulative nonparticipating preferred stock, and 1,000 shares of $10 par value common stock. Custer paid $2,000 cash dividends, including one-year dividends in arrears to preferred stockholders. Common stockholders received
A. $0.
B. $800.
C. $1,818.
D. $600.
Question 3 of 20
5.0 PointsSunrise Online issued 500 shares of its $10 common stock in exchange for equipment with a fair market value of $7,500. The entry to record the transaction would include a
A. debit to Equipment for $5,000.
B. debit to Common Stock for $5,000.
C. credit to Paid-In Capital in Excess of Par Value for $2,500.
D. credit to Common Stock Subscribed for $5,000.
Question 4 of 20
5.0 PointsWashington Corporation issued 4,000 shares of its $20 par value common stock for $23 per share. The entry to record the issuance would include a
A. debit to Cash for $80,000.
B. credit to Common Stock for $12,000.
C. credit to Common Stock for $80,000.
D. debit to Paid-In Capital in Excess of Par Value for $12,000.
Question 5 of 20
5.0 PointsThe Logan Company issued 140 shares of its $12 par value stock for $14 per share. The entry to record the receipt of cash and issuance of the stock would include a
A. debit to Cash for $1,680 and a credit to Common Stock for $1,680.
B. debit to Cash for $1,960.
C. credit to Common Stock for $1,960.
D. debit to Discount on Common Stock for $280.
Dividends in arrears occur when the company doesn’t pay dividends to
A. cumulative preferred stockholders.
B. noncumulative preferred stockholders.
C. participating preferred stockholders.
D. nonparticipating common stockholders.
Question 7 of 20
5.0 PointsOfficers of the corporation are
A. appointed by the stockholders.
B. stockholders of the corporation.
C. appointed by the board of directors.
Question 8 of 20
5.0 Points Which of the following is a characteristic of a corporation?A. The stockholders have limited liability.
B. When stockholders sell their shares, the corporation is dissolved.
C. A corporation cannot own property in its name.
D. Cash dividends to the stockholders are nontaxable.
Question 9 of 20
5.0 PointsPreferred stock that’s given a right to share with the common stock in dividends in excess of a stated preferred dividend rate is called
A. nonparticipating.
B. participating.
C. cumulative.
D. noncumulative.
hubarb Corporation’s outstanding stock is 100 shares of $100, 11% cumulative nonparticipating preferred stock, and 2,000 shares of $12 par value common stock. Rhubarb paid $1,600 cash dividends during the year. Common stockholders received
A. $0.
B. $500.
C. $2,500.
D. $1,100.
Explanation / Answer
B debit to Paid-In Capital in Excess of Par for $400.
2 B
Preferred stock holders received to per year = 6% x (100 shares x $100) = $600
This year preferred stock holders will get
= 2 x $600
= $1,200
Common stockholders have received $2,000 - $1,200 = $800
C Credit to paid - in capital in excess of par(7500-500*10).
credit to Paid-In Capital in Excess of Par Value for $2,500.
C credit to Common Stock for $80,000.
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