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Feb 25, 2016. :__________________________________________ DATE:______________________ STUDENT NO: ___________________________________ AC 214 SURVEY OF MANAGERIAL ACCOUNTING EXAM I (Chapters 11, 12, & 13) Multiple Choice Questions: (2 points each) Direction: Underline the correct answer to each question or statement listed below. There is only one correct answer per question or statement. 1.. The par value of stock refers to the: A. Market price of the stock. B. Dividend value of the stock. C. Issue price of the stock. D. Legal value assigned to the stock per the corporate charter. 2.. ____________ generally does not include voting rights. A. Common stock B. Preferred stock C. Par common stock D. No-par common stock 3. The maximum number of shares that a corporation may issue is referred to as: A. Authorized stock. B. Outstanding stock. C. Issued stock. D. Common stock. 4.. Withdrawals are to sole proprietorships as _____________ are to corporations. A. Distributions B. Losses C. Dividends D. Stock splits 5. All of the following are benefits of ownership in a corporation except: A. A corporation has an unlimited life. B. Shareholders have unlimited liability. C. Ownership is easily transferable. D. Both large and small investors can easily participate in corporate ownership 6.. When the corporate charter does not specify a par value for the stock, the total amount received from the sale of stock is credited to: A. Additional paid-in capital. B. Common stock. C. Retained earnings. D. Contributed capital. 7. A company receives equipment worth $50,000 in exchange for 10,000 shares of $2 par value stock. This transaction includes an increase to: A. Common stock for $50,000. B. Additional paid-in capital for $20,000. C. Common stock for $20,000. D. Equipment for $30,000. 8. To calculate the number of shares outstanding, subtract the number of shares: A. Issued from the number of shares authorized. B. Sold from the number of shares issued. C. Repurchased from the number of shares issued. D. Authorized from the number of shares issued. 9. Treasury stock held by a corporation: A. Is subtracted from total stockholders’ equity on the balance sheett B. Receives dividends. C. Has voting rights. D. Is included in assets. 10.. Shares of stock issued and not bought back by the corporation are called __________ shares. A. Authorized B. Issued C. Outstanding D. Sold 11. Stock that is reacquired and held by the issuing corporation is known as: A. Retained stock. B. Treasury stock. C. Preferred stock. D. Capital stock 12. Earnings per share is a measure of the: A. Amount of income generated from total stockholders equity. B. Amount of income generated for each share of common stock owned by stockholders. C. Profit generated from the total amount invested in the corporation. D. Assets used to generate income available to common shareholders. 13. The date the board of directors officially approves the dividend is known as the: A. Declaration date. B. Date of record. C. Date of payment. D. Dividend date. 14. When preferred stock carries a cumulative dividend preference, any prior years unpaid dividends for preferred stock are known as: A. Back dividends. B. Stock dividends. C. Dividends in arrears. D. Dividends in default. 15. A corporation’s distribution of additional shares of its own stock to its stockholders at no cost to the stockholders is called a: A. Stock distribution. B. Stock premium. C. Stock split. D. Stock dividend. 16. A stock dividend transfers: A. Contributed capital to retained earnings. B. Contributed capital to assets. C. Retained earnings to contributed capital. D. Profit to contributed capital. 17. If a stock dividend is equal to less than 20 – 25% of outstanding shares then it is: A. Recorded at the par value of the stock. B. Recorded at the market value of the stock. C. Recorded at the cost of the stock. D. Not recorded since it is considered a small stock dividen…

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