Acc Exam 4 Questions & Answers 2024/2025
Advantages of a corporation - ANSWERScan raise more capital than a proprietorship or partnership can, continuous life and ease of transferring ownership, and the limited liability of stockholders
Disadvantages of a corporation - ANSWERSseparation of ...
Advantages of a corporation - ANSWERScan raise more capital than a proprietorship or partnership can,
continuous life and ease of transferring ownership, and the limited liability of stockholders
Disadvantages of a corporation - ANSWERSseparation of ownership and management, double taxation of
distributed profits, and government regulation
Stockholders Rights - ANSWERSvote, dividends, liquidation, and preemption
Stockholders equity includes - ANSWERSpaid-in capital and retained earnings
Classes of Stock - ANSWERScommon stock and preferred stock
Value Classes of Stock - ANSWERSpar value and no-par
Three classifications of stock - ANSWERSauthorized, issued, and outstanding
what is outstanding stock - ANSWERSnumber of issued shares less the shares held by the corporation as
treasury
To declare a cash dividend, the company must have enough ____________ to declare the dividend; and
enough ________ to pay the dividend - ANSWERSretained earnings; cash
Which dividend date creates a liability for the company? - ANSWERSdeclaration date
what is significant about the date of record? - ANSWERSdetermines which stockholders receive the
dividend in the event the shares are sold
, What happens on the payment date? - ANSWERSdividend actually goes out
Why is treasury stock good? - ANSWERSmakes shares available for employee stock purchase, increases
EPS, helps distribute excess cash to stockholders
treasury stock is what kind of account - ANSWERScontra-stockholders equity account (not an asset)
treasury stock does not affect what - ANSWERSthe original common stock --
what is treasury stock deducted from - ANSWERStotal paid in capital (decreases total stockholders
equity)
resale of treasury stock does not record - ANSWERSgain or loss
resale of treasury stock increases what? - ANSWERSassets and equity, but not net income
Stock dividends - ANSWERScontinue dividends, but conserve cash
2 types of stock dividends - ANSWERSsmall and large
small stock dividends are recorded at - ANSWERSmarket value
large stock dividends are recorded at - ANSWERSpar value
stockholders equity and the accounting equation are _______________ by stock dividends -
ANSWERSunchanged
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