21. The residual interest in a corporation belongs come the a. Management. B. Creditors. C. Usual stockholders. D. Desired stockholders
22. The pre-emptive best of a typical stockholder is the best to a. Re-publishing proportionately in that company assets ~ above liquidation. B. Re-superstructure proportionately in any new issues of stock of the exact same class. C. Get cash dividends before they are dispersed to desired stockholders. D. Exclude preferred stockholders from voting rights.

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23. The pre-emptive right permits a stockholder to a. Share proportionately in any new issues of stock of the same class. B. Obtain cash dividends before other class of share without the pre-emptive right. C. Sell capital stock back to the corporation in ~ the option of the stockholder. D. Obtain the same amount of dividend on a percentage basis together the desired stockholders.
24. In a corporate type of service organization, legal funding is ideal defined together a. The quantity of funding the state that incorporation enables the agency to accumulate end its existence. B. The par value of all funding stock issued. C. The lot of capital the federal government enables a corporation come generate. D. The total funding raised through a corporation in ~ the limits collection by the Securities and also Exchange Commission.
25. Shareholder of a service enterprise are said to it is in the residual owners. The ax residual owner method that shareholders a. Are entitled come a dividend annually in which the company earns a profit. B. Have the rights to particular assets of the business. C. Bear the ultimate risks and also uncertainties and also receive the benefits of companies ownership. D. Have the right to negotiate individual contract on instead of of the enterprise.
26. Complete stockholders" same represents a. A claim to particular assets added by the owners. B. The maximum amount that have the right to be borrowed by the enterprise. C. A claim versus a section of the full assets of an enterprise. D. Only the quantity of revenue that have been maintained in the business.
27. A primary source of stockholders" same is a. Revenue retained by the corporation. B. Appropriated retained earnings. C. Contribute by stockholders. D. Both revenue retained through the corporation and also contributions by stockholders.
28. Stockholders" equity is usually classified right into two significant categories: a. Added capital and appropriated capital. B. Appropriated capital and retained earnings. C. Preserved earnings and unappropriated capital. D. Deserve capital and contributed capital.
29. The accounting problem in a lump amount issuance is the allocation of proceeds between the great of securities. An acceptable method of allocation is the a. Agree forma method. B. Proportional method. C. Incremental method. D. Either the proportional an approach or the incremental method
30. When a corporation worries its funding stock in payment because that services, the leastappropriate basis because that recording the transaction is the a. Market value of the solutions received. B. Par worth of the share issued. C. Sector value the the shares issued. D. Any type of of these offers an proper basis for recording the transaction
31. Direct prices incurred to offer stock such together underwriting costs should be accounted for together 1. A palliation of added paid-in capital. 2. An expense of the period in i m sorry the share is issued. 3. One intangible asset. A. 1 b. 2 c. 3 d. 1 or 3
32. A "secret reserve" will be developed if a. Insufficient depreciation is fee to income. B. A resources expenditure is charged to expense. C. Liabilities room understated. D. Stockholders" equity is overstated.
33. I beg your pardon of the adhering to represents the total variety of shares that a coporation, group may issue under the regards to its charter? a. Authorized share b. Issued shares c. Unissued share d. Exceptional shares
34. Share that has a addressed per-share amount printed on every stock certificate is dubbed a. Declared value stock. B. Solved value stock. C. Uniform worth stock. D. Par value stock
35. I beg your pardon of the complying with is not a legit restriction related to profit distributions by a corporation? a. The amount dispersed to owners have to be in compliance through the state laws governing corporations. B. The amount spread in any type of one year deserve to never exceed the net income reported for that year. C. Benefit distributions should be formally approved by the board of directors. D. Dividends need to be in full commitment with the capital stock contracts as to preferences and also participation
36. In January 2012, Finley corporation, a newly developed company, authorize 10,000 shares of its $10 par typical stock for $15 every share. OnJuly 1, 2012, Finley coporation, group reacquired 1,000 share of its exceptional stock for $12 every share. The salvation of this treasury shares a. Decreased complete stockholders" equity. B. Increased full stockholders" equity. C. Go not adjust total stockholders" equity. D. Lessened the number of issued shares.
37. Treasury shares space a. Shares hosted as an invest by the treasurer the the corporation. B. Shares held as an invest of the corporation. C. Issued and also outstanding shares. D. Issued but not impressive shares
38. As soon as treasury stock is to buy for an ext than the par value of the stock and also the cost an approach is provided to account for treasury stock, what account(s) have to be debited? a. Treasury stock for the par value and also paid-in resources in overfill of par for the overabundance of the purchase price end the par value. B. Paid-in funding in excess of par because that the acquisition price. C. Treasury stock for the acquisition price. D. Treasury stock because that the par value and also retained revenue for the overabundance of the acquisition price end the par value.
39. ―Gains" top top sales that treasury stock (using the cost method) have to be attributed toa. Paid-in resources from treasury stock. B. Funding stock. C. Retained earnings. D. Other income
40. Porter Corp. Purchased its own par value stock ~ above January 1, 2012 because that $20,000 and also debited the treasury share account for the acquisition price. The stock to be subsequently offered for $12,000. The $8,000 difference between the cost and also sales price have to be recorded as a deduction indigenous a.additional paid-in funding to the extent that previous network "gains" native sales the the same class of share are contained therein; otherwise, from preserved earnings. B. Additional paid-in resources without regard as to whether or no there have actually been previous net "gains" from sales the the same class of stock consisted of therein. C. Kept earnings. D. Net income.
a.additional paid-in capital to the extent that previous network "gains" native sales the the same class of share are consisted of therein; otherwise, from maintained earnings.
41. Exactly how should a "gain" native the sale of treasury share be reflected as soon as using the cost technique of record treasury share transactions? a. As plain earnings presented on the earnings statement. B. Together paid-in resources from treasury stock transactions. C. As boost in the amount shown for typical stock. D. As an particularly item displayed on the income statement.
42. I m sorry of the following best describes a possible result of treasury share transactions through a corporation? a. Might increase however not decrease retained earnings. B. May rise net revenue if the cost an approach is used. C. Might decrease but not increase retained earnings. D. Might decrease however not boost net income.
43.Which the the following functions of desired stock renders the security an ext like debt 보다 an equity instrument? a. Participating b. Poll c. Redeemable d. Noncumulative
44.The cumulative function of preferred stock a. Limits the lot of cumulative dividends to the par worth of the preferred stock. B. Requires that dividends no paid in any year should be consisted of in a later on year prior to dividends are spread to typical shareholders. C. Means that the shareholder have the right to accumulate desired stock till it is same to the par value of usual stock in ~ which time it deserve to be converted into common stock. D. Allows a desired stockholder to accumulate dividends until they same the par value of the stock and also receive the share in ar of the cash dividends
b. Needs that dividends no paid in any kind of year have to be made up in a later year prior to dividends are distributed to usual shareholders.
45.According come the FASB, redeemable preferred stock have to be a. Contained with typical stock. B. Contained as a liability. C. Excluded native the stockholders" equity heading.d. Consisted of as a contra item in stockholders" equity.
46. Cumulative preferred dividends in arrears have to be shown in a corporation"s balance sheet as a. Boost in present liabilities. B. Boost in stockholders" equity. C. A footnote. D. An increase in current liabilities for the current portion and permanent liabilities for the irreversible portion.
47.At the date of the financial statements, typical stock share issued would certainly exceed common stock shares superior as a result of the a. Declaration of a stock split. B. Explanation of a share dividend. C. Purchase of treasury stock. D. Payment in full of subscribed stock
48.An entrance is no made ~ above the a. Day of declaration. B. Date of record. C. Date of payment. D. An entry is made on every one of these dates.

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49.Cash dividends are paid ~ above the basis of the number of shares a. Authorized. B. Issued. C. Outstanding. D. Outstanding much less the number of treasury shares
50.Which that the following statements around property dividend is nottrue? a. A building dividend is usually in the type of securities of various other companies. B. A building dividend is also called a dividend in kind. C. The accounting for a building dividend have to be based on the transporting value (book value) the the nonmonetary heritage transferred. D. All of these statements space true
c. The audit for a property dividend have to be based on the transporting value (book value) that the nonmonetary assets transferred.