31. During 2014, Thomas Corporation repurchased some shares of its own common st
ID: 2501263 • Letter: 3
Question
31. During 2014, Thomas Corporation repurchased some shares of its own common stock. What effect did this transaction have on 2014 stockholders' equity and earnings per share, respectively?
Option A
Option B
Option C
Option D
32 RKJ Company has provided the following:
• 100,000 shares of $5 par value common stock are authorized
• 70,000 shares were issued for $9 per share
• 65,000 shares are outstanding
Which of the following statements is correct based only on the above facts?
A Common stock is reported at $630,000 on the balance sheet.
B Additional-paid in capital is reported at $260,000 on the balance sheet.
C Common stock is reported at $350,000 on the balance sheet.
D Treasury stock is reported at $45,000 on the balance sheet.
33. A company purchased 1,000 shares of treasury stock for $38,000 cash. The treasury stock was initially issued for $24,000 and had a $9,000 par value. Which of the following statements incorrectly describes the effect of the treasury stock purchase?
A Net income is unchanged.
B Earnings per share increases.
C Total assets remain the same.
D Stockholders' equity decreases.
34 Which of the following entries would be recorded when a company reissues 1,000 shares of treasury stock for $50 per share when they were repurchased at a cost of $47 per share and have a $1 par value?
35 Which of the following statements is false?
A The declaration of a cash dividend creates a liability as of the date of record.
B The date of record is irrelevant with respect to recording a liability for a cash dividend.
C The dividend payment date is when the dividend liability is reduced.
D The dividend liability for a cash dividend is created on the declaration date.
36 A company reported the following asset and liability balances at the end of 2013 and 2014:
During 2014, cash dividends of $50,000 were declared and paid, and common stock was issued for $100,000. How much was the 2014 net income?
A $400,000.
B $480,000.
C $350,000.
D $300,000.
STOCKHOLDERS EQUITY EARNINGS PER SHARE A. Decrease No effect B. Increase No effect C. Decrease Decrease D. Decrease IncreaseExplanation / Answer
31) STOCKHOLDERS EQUITY EARNINGS PER SHARE D. Decrease Increase 32) Common stock issued 630,000 70000*9 A Common stock is reported at $630,000 on the balance sheet. 33) C Total assets remain the same. while purchasing the treasury shares the cash would decrease. 34) A. Cash $50,000 Treasury Stock $47,000 Capital in excess of par $3,000 35) B The date of record is irrelevant with respect to recording a liability for a cash dividend.
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