A) Increases net income.
B) Increases stockholders' equity.
C) Has no effect on net income or stockholders' equity.
D) Decreases net income and decreases stockholders' equity.
Answer: B
A) 170,000.
B) 220,000.
C) 210,000.
D) 180,000.
Answer: A
A) Increasing the number of shares outstanding.
B) Increasing profits.
C) Reducing the number of shares outstanding.
D) Decreasing the company's obligation to pay dividends.
Answer: C
A) To distribute surplus cash without paying dividends.
B) To boost earnings per share.
C) To satisfy employee stock ownership plans.
D) All of the other answer choices are correct.
Answer: D
A) Preferred Stock.
B) Authorized Stock.
C) Treasury Stock.
D) Common Stock.
Answer: C
A) Increase assets and increase stockholders' equity.
B) Decrease assets and increase stockholders' equity.
C) Decrease assets and decrease stockholders' equity.
D) No effect on the accounting equation.
Answer: C
A) Treasury stock is reported on the balance sheet in the equity section.
B) The purchase and sale of treasury stock has no impact on the income statement.
C) Treasury stock represents a negative equity account.
D) All of the other answer choices are correct.
Answer: D
A) Treasury stock is recorded as an asset by the acquiring company.
B) Only losses on the sale of treasury stock are recorded in the income statement.
C) Stockholders' equity is reduced when treasury stock is acquired.
D) Gains and losses on the sale of treasury stock are recorded in the income statement.
Answer: C
A) Decrease.
B) Increase.
C) No effect.
D) Cannot determine from the given information.
Answer: C
A) Decrease.
B) Increase.
C) No effect.
D) Cannot determine from the given information.
Answer: A
A) A gain account is credited.
B) A loss is reported.
C) A revenue account is credited.
D) Additional Paid-in Capital is increased.
Answer: D
A) Debit Preferred Stock $5,000.
B) Credit Cash $5,000.
C) Credit Preferred Stock $5,000.
D) Credit Additional Paid-In Capital $4,000.
Answer: D
A) Convertible.
B) Redeemable.
C) Cumulative.
D) They all are potential features of preferred stock.
Answer: D
A) Common Stock.
B) Preferred Stock.
C) Bonds.
D) The other answer choices have equal preference.
Answer: C
A) Common Stock.
B) Preferred Stock.
C) Bonds.
D) They all have similar voting rights.
Answer: A
A) Bonds.
B) Preferred Stock.
C) Common Stock.
D) They all have similar expected returns.
Answer: A
A) Common Stock.
B) Preferred Stock.
C) Bonds.
D) They all have similar expected returns.
Answer: A
A) Is always recorded as a liability.
B) Is always recorded as part of stockholders' equity.
C) Can have features of both liabilities and stockholders' equity.
D) Is not included in either liabilities or stockholders' equity.
Answer: C
A) Debit to Cash $1,500.
B) Credit to Additional Paid-In Capital $1,400.
C) Credit to Common Stock of $100.
D) All of the other answer choices are correct.
Answer: D
A) Debit Common Stock $10,000.
B) Credit Cash $50,000.
C) Credit Common Stock $50,000.
D) Credit Additional Paid-In Capital $40,000.
Answer: D
