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acct 321_Question




Question;1) Which of the following;describes a term bond?;A) A bond that repays principal in;installments;B) A bond that gives the;bondholder a claim for specific assets if the issuer fails to pay;C) A bond that matures at one;specified time;D) A bond that is not backed by;specific assets;2) Which of the following;describes a secured bond?;A) A bond that repays principal in;installments;B) A bond that gives the;bondholder a claim for specific assets if the issuer fails to pay;C) A bond that matures at one;specified time;D) A bond that is not backed by;specific assets;3) Which of the following;characteristics is an advantage of the corporate form of business?;A) Higher degree of government;regulation;B) The potential to raise large;amounts of capital;C) Separation of ownership and;management;D) Double taxation;4) On December 2, 2014, Ewell;Company purchases a piece of land from the original owner.In payment for the land, Ewell Company;issues 8,000 shares of common stock with $1.00 par value.The land has been appraised at a;market value of $400,000.The;journal entry to record this transaction would include which of the following;items?;A) Debit Common stock $8,000 and;debit Paid-in capital $392,000.;B) Credit Common stock $8,000 and;credit Paid-in capital $392,000.;C) Credit Common stock $400,000.;D) Debit Cash $400,000.;5);Please refer to the equity section of the balance sheet shown below;Preferred stock;$100;par, 10,000 shares authorized, 1,000 shares issued;$100,000;Common stock;$1;par, 500,000 shares authorized, 20,000 shares issued;20,000;Paid-in capital;in excess of par;350,000;Retained;earnings;(74,000);Total;stockholders' equity;$396,000;The;amount shown for Retained earnings would be called a(n);A);net loss.;B);earnings shortfall.;C) retained;earnings deficit.;D);loss on sale of stock.;6);Please refer to the equity section shown below;Preferred;stock, $100 par, 4% non-cumulative;$20,000;1,000 shares;authorized, 200 shares outstanding;Common stock;$0.01 par;400;1,000,000 shares;authorized, 40,000 shares outstanding;Paid-in capital;in excess of par;359,600;Retained;earnings;820,000;Total;stockholders' equity;$1,200,000;Assume;the preferred shares have no stated liquidation value. The preferred shares are;non-cumulative, so there are no dividends in arrears.;Please;calculate the book value per share of common stock.;A);$30.00 per share;B);$8.99 per share;C);$9.00 per share;D);$29.50 per share;7) Which of the following is a;reason why a company would do a stock split?;A) To defend against a hostile;takeover;B) To generate additional sales;revenues;C) To reduce the market price at;which the stock is trading;D) To provide the shareholders;with something of value, when the company cannot afford a cash dividend;8) Please refer to the following;information for Peartree Company;?Common stock, $1.00 par, 100,000;issued, 95,000 outstanding;?Paid-in capital in excess of par;$2,150,000;?Retained earnings:$910,000;?Treasury stock: 5,000 shares purchased;at $20 per share;If Peartree purchases an;additional 1,000 shares of treasury stock at $18 per share, what journal entry;will be required?;A) Debit Treasury stock $18,000;and credit Retained earnings $18,000.;B) Debit Treasury stock $20,000;credit Loss on sale $2,000 and credit Cash $18,000.;C) Debit Treasury stock $18,000;and credit Cash $18,000.;D) Debit Cash $18,000 and credit;Treasury stock $18,000.;9) Which of the following would be;a reason for a company to restrict its cash dividends or treasury stock purchases?;A) Because the company needs;treasury stock to offer as performance incentives to upper management;B) In order to give shareholders;stock dividends;C) Due to the desire of;shareholders to retain the company's earnings for future growth and capital;expenditures;D) Due to requirements of lenders;or creditors that companies maintain enough equity to meet their obligations;10) At January 1, 2014, Foxmore Company had 80,000 shares of;common stock outstanding and no preferred stock. During the year, they;issued 40,000 additional shares of common stock. At December 31, 2014;Foxmore had 120,000 shares of common stock outstanding, and no preferred;stock. In addition, Foxmore reported the following results for the year;2014;Sales revenues;from regular business operations;$3,000,000;Cost of goods;sold;900,000;Operating;expenses from their regular business operations;600,000;Gain on;disposal of several items of property, plant & equipment;15,000;Income tax;expense on continuing operations;330,000;Loss on the;termination of a discontinued business segment, net of tax;120,000;Losses on;damage caused by earthquake, net of tax;280,000;At;December 31, 2014, how much is the earnings per share for income (loss) from;continuing operations?;(Please;round all calculations to the nearest cent.);A);$(1.20);B);$7.85;C);$10.65;D);$11.85


Paper#45327 | Written in 18-Jul-2015

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