11 Select Answer: 12 Select Answer: Zillion Corpoation issued 100,000 shares of $1.00 par common stock at a price of $5.00 per share. What account is used for the extra money received, beyond the par value? A. It is net income and should go to Retained Earnings B. It represents a liability that the corporation must pay back C. It goes to the Paid in Capital in Excess of Par account and is not part of net income D. It should be reported on the income statement A corporation purchases shares of its own stock for the purpose of rewarding executives and other employees. These shares are called: A. preferred stock B. treasury stock C. stock dividends 15 Select Answer: 16 17 Select Answer: Select Answer: On a cash flow statement using the Indirect Method, how would noncash expenses such as depreciation, depletion and amortization be treated? A. subtract depreciation from the net income figure B. add back the depreciation to the net income figure C. subtract depreciation from the cash flows from investing D. subtract depreciation from cash flows from financing Name a characteristic of preferred stock. A. Only preferred stockholders are allowed to vote for the board of directors. B. Preferred stockholders are required to receive a dividend every year. C. Preferred stockholders receive a fixed dividend amount or percentage. D. If the corporation liquidates, only the common shareholders will receive proceeds. Donna borrowed $400,000 from Bank of America on a 6% 30-year installment loan with monthly payments. How would the payment be determined? A. Multiply $400,000 times the interest factor for 30 years at 6%. B. Multiply $400,000 times the interest factor for 30 years at 1/2%. C. Divide $400,000 by the interest factor for 30 years at 1/2%. D. Divide $400,000 by the interest factor for 30 years at 1%. 20 20 Select Answer: How would you characterize the account Discount on Bonds Payable? A. The discount on bonds payable represents extra cash received when the bonds were issued. B. The discount on bonds payable is considered extra future interest expense, because of the cash not received at bond issuance. C. The discount on bonds payable has a credit balance which adds to the bond's carrying value. D. The discount on bonds payable represents a decrease in future interest expense