ACC101 NEW SP26 – Worksheet Questions (Pages 36–40)

The date the directors vote to declare and pay a dividend is called the:

• Date of stockholders' meeting.

• Date of declaration.

• Date of record.

• Date of payment.

• Liquidating date.

Stockholders' equity consists of which of the following?

• Long-term assets.

• Paid-in capital and retained earnings.

• Paid-in capital and par value.

• Retained earnings and cash.

• Premiums and discounts.

When a corporation has only one class of stock, the stock is called

• Preferred stock.

• Common stock.

• Par value stock.

• Stated value stock.

• No-par value stock.

Par value of a stock refers to the:

• Issue price of the stock.

• Value assigned per share by the corporate charter.

• Market value of the stock on the date of the financial statements.

• Maximum selling price of the stock.

• Dividend value of the stock.

The total amount of cash and other assets received by a corporation from its stockholders in exchange for its stock is:

• Always equal to its par value.

• Always equal to its stated value.

• Referred to as paid-in capital.

• Referred to as retained earnings.

• Always below its stated value.

A premium on common stock:

• Occurs when a corporation sells its stock for more than par or stated value.

• Is the difference between par value and issue price when the amount paid is below par.

• Represents profit from issuing stock.

• Represents capital gain on sale of stock.

• Is prohibited in most states.

The difference between the amount received from issuing a note payable and the amount repaid at maturity is referred to as:

• Interest.

• Principle.

• Face Value.

• Cash.

• Par Value.

A bond sells at a discount when the:

• Contract rate is above the market rate.

• Contract rate is equal to the market rate.

• Contract rate is below the market rate.

• Bond has a short-term life.

• Bond pays interest only once a year.

The right of common shareholders to purchase their proportional share of any common stock later issued by the corporation is called a:

• preemptive right

• proxy right

• right to call

• financial leverage

• voting right

All of the following are true of known liabilities except:

• Include accounts payable, notes payable, and payroll.

• Are obligations set by agreements, contracts, or laws.

• Are measurable.

• Are definitely determinable.

• May depend on some future event occurring.