#1) A company issues 1.18 million shares of preferred stock with a par value of $11.00 at its market price of $35.00 per share. The issuance should be recorded with a debit to Cash for:

$28.32 million, a credit to Additional Paid-in Capital for $12.98 million, and a credit to Preferred Stock for $41.30 million.

$41.30 million and a credit to Preferred Stock for $41.30 million.

$12.98 million and a credit to Preferred Stock for $12.98 million.

$41.30 million, a credit to Preferred Stock for $12.98 million, and a credit to Additional Paid-in Capital for $28.32 million.

#2) The combined effect of the declaration and payment of a cash dividend on a company's financial statements is to:

A - increase total liabilities and decrease stockholders' equity.

B - increase total expenses and decrease assets.

C - increase total assets and increase stockholders' equity.

D - decrease total assets and decrease stockholders' equity.

#3) All of the following are a part of contributed capital except:

A - Common Stock.

B - Additional Paid-in Capital.

C - Preferred Stock.

D - Retained Earnings.

#4) In an IPO on May 1, 2009, Timmy Hilfigure purchased 1,000 shares of Abner Crummie, Inc. for $5,000. On April 30, 2015, Timmy Hilfigure sold the 1,000 shares for $8,000 to Ralph Loring. What is the effect of the sale on April 30, 2015?

A - Abner Crummie, Inc. will record a $3,000 loss.

B - Abner Crummie, Inc. will record a $3,000 gain.

C - Abner Crummie, Inc. will not be directly affected by this transaction.

D - Abner Crummie, Inc. will record a decrease in Cash of $8,000.