Accounting 2 Midterm Review

Each unit of ownership in a corporation is known as a stock dividend.

• TRUE
• FALSE

A stockholder is an owner of one or more shares of a corporation.

• TRUE
• FALSE

Dividends are earnings retained by the corporation.

• TRUE
• FALSE

A board of directors distributes earnings of a corporation to its stockholders by declaring a dividend.

• TRUE
• FALSE

When a declared dividend is paid, Dividends Payable is credited.

• TRUE
• FALSE

The steps for preparing a work sheet are very different for proprietorships and corporations.

• TRUE
• FALSE

Most accounts needing adjustment at the end of a fiscal period have a related temporary account.

• TRUE
• FALSE

The difference between an asset's account balance and its related contra account balance is called par value

• TRUE
• FALSE

An income statement is used to report a business's financial progress.

• TRUE
• FALSE

Individual amounts reported on an income statement have significant meaning without being compared to another amount.

• TRUE
• FALSE