Multiple Choice Questions Use the following information for Questions 1 to 2: These account balances at December
Question:
Multiple Choice Questions
Use the following information for Questions 1 to 2:
These account balances at December 31 relate to Sportworld, Inc.:
1. What is total paid-in capital for Sportworld, Inc.?
a. $634,445
b. $622,000
c. $641,345
d. $693,300
e. None of the above
2. What is total stockholders equity for Sportworld, Inc.?
a. $688,100
b. $641,345
c. $693,300
d. $698,500
e. None of the above
3. Sportworld’s net income for the period is $119,100 and beginning common stockholders equity is $681,500. Calculate Sportworld’s return on common stockholders equity.
a. 17.2%
b. 16.4%
c. 18.2%
d. 19.3%
4. A company paid $24 per share to purchase 600 shares of its common stock as treasury stock. The stock was originally issued at $16 per share. The journal entry to record the purchase of the treasury stock is:
5. When treasury stock is sold for less than its cost, the entry could include a debit to:
a. Paid-in Capital in Excess of Par.
b. Retained Earnings.
c. Gain on Sale of Treasury Stock.
d. Loss on Sale of Treasury Stock.
6. A company purchased 100 shares of its common stock at $50 per share. It then sells 35 of the treasury shares at $56 per share. The entry to sell the treasury stock includes a
a. Credit to Paid-in Capital, Treasury Stock for $210.
b. Debit to Retained Earnings for $210.
c. Credit to Retained Earnings for $600.
d. Credit to Treasury Stock for $1,960.
e. Credit to Cash for $1,960.
7. Stockholders are eligible for a dividend if they own the stock on the date of:
a. Record.
b. Issuance.
c. Declaration.
d.Payment.
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Step by Step Answer:
Financial accounting
ISBN: 978-0136108863
8th Edition
Authors: Walter T. Harrison, Charles T. Horngren, William Bill Thomas