ACC 556 WEEK 6 HOMEWORK CHAPTER 10 AND 11
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ACC 556 WEEK 6 HOMEWORK CHAPTER 10 AND 11
CHAPTER 10
1.
A current liability
must be paid out of current earnings.
2.
Most notes are not
interest bearing.
3.
Unearned revenues are
received before goods are delivered or services are rendered.
4.
The carrying value of
bonds is calculated by adding the balance of the Discount on Bonds Payable
account to the balance in the Bonds Payable account.
5.
Material gains or
losses on bond redemption are reported as an extraordinary item on the income
statement.
6.
Liabilities are
classified on the balance sheet as current or
7.
With an
interest-bearing note, the amount of assets received upon issuance of the note
is generally
8.
The interest charged
on a $70,000 note payable, at the rate of 6%, on a 90-day note would be
9.
On January 1, 2014,
Keisler Company, a calendar-year company, issued $700,000 of notes payable, of
which $175,000 is due on January 1 for each of the next four years. The proper
balance sheet presentation on December 31, 2014, is
10. Norlan Company does not ring up sales taxes
separately on the cash register. Total receipts for October amounted to
$29,400. If the sales tax rate is 5%, what amount must be remitted to the state
for October’s sales taxes?
11. Stockholders of a company may be reluctant to
finance expansion through issuing more equity because
12. Which of the following is not an advantage of
issuing bonds instead of common stock?
13. When authorizing bonds to be issued, the board
of directors does not specify the
14. If the market rate of interest is 10%, a
$10,000, 12%, 10-year bond that pays interest annually would sell at an amount
15. If bonds are issued at a discount, it means
that the
16. In the balance sheet, the account Discount on
Bonds Payable is
17. If bonds have been issued at a discount, then
over the life of the bonds the
18. Ervay Company has $875,000 of bonds
outstanding. The unamortized premium is $12,600. If the company redeemed the
bonds at 101, what would be the gain or loss on the redemption?
19. The relationship between current assets and
current liabilities is
20. Match the items below by entering the
appropriate code letter in the space provided.
CHAPTER 11
1.
A corporation is not
an entity that is separate and distinct from its owners.
2.
A stockholder has the
right to vote in the election of the board of directors.
3.
The acquisition of
treasury stock by a corporation increases total assets and total stockholders’
equity.
4.
Cash dividends are not
a liability of the corporation until they are declared by the board of
directors.
5.
A detailed
stockholders’ equity section in the balance sheet will list the names of
individuals who are eligible to receive dividends on the date of record.
6.
Under the corporate
form of business organization
7.
Which of the following
statements reflects the transferability of ownership rights in a corporation?
8.
If a stockholder
cannot attend a stockholders’ meeting, he may delegate his voting rights by
means of a(n)
9.
If Norben Company
issues 4,000 shares of $5 par value common stock for $140,000, the account
10. Holden Packaging Corporation began business in
2014 by issuing 80,000 shares of $5 par common stock for $8 per share and
20,000 shares of 6%, $10 par preferred stock for par. At year end, the common
stock had a market value of $10. On its December 31, 2014 balance sheet, Holden
Packaging would report
11. The following data is available for BOX
Corporation at December 31, 2014:
Common stock, par $10 (authorized 30,000 shares) $250,000
Treasury stock (at cost $15 per share) $ 1,200
Based on the data, how many shares of common stock are issued?
Common stock, par $10 (authorized 30,000 shares) $250,000
Treasury stock (at cost $15 per share) $ 1,200
Based on the data, how many shares of common stock are issued?
12. Which of the following is not a right or
preference associated with preferred stock?
13. All of the following statements about
preferred stock are true except
14. The board of directors of Benson Company
declared a cash dividend of $1.50 per share on 42,000 shares of common stock on
July 15, 2014. The dividend is to be paid on August 15, 2014, to stockholders
of record on July 31, 2014. The effects of the journal entry to record the
payment of the dividend on August 15, 2014, are to
15. Which of the following statements is not true
about a 2-for-1 split?
16. The following selected amounts are available
for Thomas Company.
17. In the stockholders’ equity section of the
balance sheet
18. Herman Corporation had net income of $120,000
and paid dividends of $24,000 to common stockholders and $20,000 to preferred
stockholders in 2014. Herman Corporation’s common stockholders’ equity at the
beginning and end of 2014 was $450,000 and $550,000, respectively. Herman
Corporation’s payout ratio for 2014 is
19. Which of the following statements is true
regarding corporate performance ratios?
20. Match the items below by entering the
appropriate code letter in the space provided.
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