Accounting Ch 21 Review

A publicly held corporation is only permitted to issue common stock.

• True
• False

A corporation is considered to be a separate legal entity.

• True
• False

The management of a corporation is elected by the stockholders.

• True
• False

The Paid-in Capital in Excess of Par account is a stockholders' equity account.

• True
• False

Investors usually buy preferred stock to receive the stated dividend that it pays.

• True
• False

When a dividend is paid, the total amount of the dividend is debited to the Cash in Bank account.

• True
• False

A document that gives a stockholder's voting rights to someone else is called a(n) ____.

• Proxy
• dividends
• statement of stockholders' equity

The maximum number of shares of capital stock a corporation may issue is called ____.

• authorized capital stock
• par value
• preferred stock

When a corporation issues only one type of capital stock, that stock is called ____.

• common stock
• preferred stock
• authorized capital stock

Stock that has special ownership privileges over common stock is called ____.

• preferred stock
• common stock
• authorized capital stock