Details of each class of share capital should be reported

On the face of the statement of financial position or in disclosure notes.

On the face of the statement of financial position only.

On the face of the statement of comprehensive income and in disclosure notes.

Outstanding ordinary shares are

Shares in the hands of shareholders

Shares that are performing well on the Philippine Stock Exchange

Shares that have been authorized| by the state for issue

Shares held in the corporate treasury

Issued shares refer to the number of shares

Outstanding plus treasury shares

That may be issued under state law

The share capital account is measured as

The number of shares issued multiplied by the par value

The number of shares outstanding multiplied by the par value

The number of shares outstanding multiplied by the market value

The number of shares issued multiplied by book value

The par value of shares issued is normally recorder in

Appropriated retained earnings account

Total shareholders' equity represents

A claim against the total assets of an entity.

A claim against specific assets.

The maximum amount that can be borrowed.

Only the amount of retained earnings.

In accounting for shareholders equity, the accountant is primarily concerned with which of the following?

Recording the source of each of the various elements of shareholders ‘equity

Determining the total amount of shareholders ‘equity

Distinguishing between realized and unrealized revenue

Making sure that the directors do not declare dividends in excess of retained earnings

The term residual owner means that ordinary shareholders

Bear the ultimate risks and uncertainties and receive the benefits of ownership.

Are entitled to a dividend every year in which the entity earns an income.

Have the rights to specific assets of the entity.

Can negotiate individual contracts for the entity.

The par value of an ordinary share represents

The legal nominal value assigned to the share

The liquidation value of the share.

The amount received by the corporation when the share is originally issued.

Contributed Capital does not include

Capital accumulated by retention of earnings treasury shares

Share premium on ordinary and preference shares

Capital resulting from reissuance of treasury at a price in excess of acquisition cost

Discount on share capital

May be recorded as either an asset or an expense

Should be closed to income summary account

May be offset against share premium on the same class of share capital

Which of the following is not one of the basic shareholders' rights?

The right to inspect the accounting records.

The right to participate in earnings.

The right to maintain one's proportional interest.

The right to participate in the proceeds of the sale of corporate assets upon liquidation of the corporation.

An ordinary shareholder does not possess which of the following?

The right to direct ownership of the corporate acts

The right to share in the earnings of the corporation

The right to vote in the election of the board of directors

The right to share proportionately in corporate a in case of liquidation.

The preemptive right of an ordinary shareholder is the right to

Share proportionately in any new issue the same class.

Share proportionately in corporate assets.

Receive cash dividends before they are distributed to preference shareholders.

Exclude preference shareholders from voting rights.

Share premium is reported

As an increase in shareholders ‘equity

As a reduction of shareholders ‘equity

When shares traded on an active exchange are issued for an asset

An asset is recorded at the fair value of the shares.

No entry is recorded until restrictions are lifted.

Can asset is recorded at the appraised value.

Share capital is increased by the appraised value of the asset.

When shares are issued in exchange for property, the best evidence of fair value might be any of the following except

The average book value of outstanding shares.

The fair value of the property received.

The selling price of the shares in a recent transaction.

The price of the shares quoted on the stock exchange.

Ordinary shareholders usually have all of the following rights, except

To participate in the day-to-day operations

To share in the assets upon liquidation

To elect the board of directors

When preference shares are retired by the issuer at price below the original issue price, the transaction

Increases contributed capital of ordinary shareholders

Increases net income for the year

When preference shares carry a redemption privilege the shareholders may

Surrender the preference shares for a specified amount of cash.

Purchase new shares when available.

Exchange their preference shares for ordinary shares.

Purchase treasury shares ahead of ordinary shareholders.

An entity that issued shares of Class B should report the share capital

As equity unless the shares are mandatorily redeemable.

Among liabilities under all circumstances.

As equity unless the shares are redeemable option of the issuer.

Among liabilities unless the shares are redeemable.

The issuance of preference shares

Increases preference shares outstanding

Has no effect on preference shares outstanding

Increases authorized preference share capital

Decreases authorized preference share capital

When an entity calls in all of the preference shares for more than the original issue price, the excess over the original issue price should be

Charged against retained earnings

Accounted for as loss on exchange

Charged against share premium of ordinary shares

Charged to a discount on preference shares

When preference shares are called in by the issuing entity for less than original issue price, proper accounting for the redemption

Increases the contributed capital of the ordinary shareholders

Increases the amount of dividends available to ordinary shareholders

Increases reported income for the period

Increases the treasury shares held by the entity

Convertible preference shares

Include an option for the holder to convert preference shares into a fixed number of ordinary shares.

Are compound financial instrument.

Are accounted for as financial liability.

All of the choices are correct.

Dividend paid accounted for as

Interest expense as component of finance cost.

Direct deduction from retained earnings.

Component of other comprehensive income

Quiz in Shareholder's Equity

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Other

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40 questions

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MULTIPLE CHOICE QUESTION

45 sec • 1 pt

When shares with par value proceeds over the par value is credited to

Share capital

Share premium

Retained earnings

Gain on issuance of share capital

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

When shares without par value are sold, the proceeds shall be credited to

Share capital

Shareholders ‘equity

Share capital to the extent of the stated value and any excess is credited to share premium

Share premium

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

If shares are issued for noncash consideration, the proceeds shall be measured by the

Fair value of the shares issued

Fair value of the noncash consideration received

Par value of the shares issued

Cost of the noncash consideration received

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

If shares are issued to extinguish a financial liability, what is the initial measurement of the shares issued?

Par value of the shares issued

Fair value of the shares issued

Fair value of liability extinguished

shares issued

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

When shares are issued for services received, the least appropriate measure is equal to

Fair value of such services

Par value of the shares issued

Book value of the shares issued

Fair value of the shares issued

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

What is the meaning of net assets of a corporation?

Contributed capital

Retained earnings

Shareholders ‘equity

Legal capital

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

The two primary account classifications within stockholders’ equity are

Preference shares and retained earnings

Par value of ordinary shares and retained earnings

Contributed capital and retained earnings

Preference shares and ordinary shares

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Quiz in Shareholder's Equity

When shares with par value proceeds over the par value is credited to

When shares without par value are sold, the proceeds shall be credited to

If shares are issued for noncash consideration, the proceeds shall be measured by the

If shares are issued to extinguish a financial liability, what is the initial measurement of the shares issued?

When shares are issued for services received, the least appropriate measure is equal to

What is the meaning of net assets of a corporation?

The two primary account classifications within stockholders’ equity are

Details of each class of share capital should be reported

The corporate charter is known as

Characteristics of the corporate form that have led to the growth of this form of business ownership include all of the following, except

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