Corporation - Shareholders’ Equity

Another term for share premium is ____

• Reserves

• Additional Paid-In Capital

• Both Reserves and Additional Paid-In Capital

• None of the options stated

Sale of treasury shares always results in an increase in stockholders’ equity.

• T

• F

Re-purchase of shares results in an increase in Treasury Shares and, consequently, total stockholders’ equity

• T

• F

Of all the items in the Statement of Changes in Stockholders’ Equity, which account is not shown in the Statement of Financial Position?

• Share Capital

• Share Premium

• Accumulated Profits – Appropriated

• Treasury Shares

Appropriations made on the Accumulated Profits are done only if there is a legal or contractual obligation to do so.

• T

• F

Share dividend declaration does not affect shareholders’ equity.

• T

• F

The bottom line in the Statement of Changes in Equity will also be used in another financial statement.

• T

• F

Reissuance of treasury shares below cost always reduces accumulated profits.

• T

• F

Cash dividends paid decreases total stockholders’ equity.

• T

• F

Upon the sale of Treasury Shares below cost and there is insufficient Share Premium – Treasury, the Share Premium – Donated Shares shall shoulder any difference before the Accumulated Profits.

• T

• F