12. Ultimate Gamer reported the following amounts in its annual financial statements: Year 1 Year 2 Number of common shares 11,600 11,800 Net income $25,740 $20,740 Cash dividends paid on common stock Total stockholders' equity $3,200 $260,000 $3,200 $240,000 For Year 2, EPS is a) $2.22 b) $2.20 c) $1.77 d) $1.75 e) None of the above. 13. Which of the following statements about bond terminology is correct? a) The face value of a bond is what it is currently worth in the market. b) The stated interest rate is expressed as an annual interest rate even if the bonds pay semiannual interest payments c) The stated rate of interest always presents the amount that investors are willing to pay for the bond on the issue date. d) The carrying value of the bond is always equal to the face value of the bond. e) None of the above 14. A cash dividend differs from a 2-for-1 stock split in that a cash dividend a) Decreases the par value per share. b) Decreases current assets. c) Increases Retained Earnings. d) Increases the number of shares outstanding. e) None of the above 15. Bullet Company issued 8% preferred stock with a $100 par value. This means: a) Preferred stockholders are entitled to 8% of the annual net income. b) Only 8% of total contributed capital can be preferred stock. c) Preferred stockholders are guaranteed a dividend. d) The potential dividend to preferred stockholders is $8 per share per year. e) None of the above. 16. Cash provided by issuing stock to owners should be reported as cash: a) Inflows from financing activities. b) Outflows from financing activities. c) Inflows from investing activities. d) Outflows from investing activities. e) None of the above. 17. If the calculation of cash flows from operating activities starts with net income, the company: a) is using the net income method. b) will remove the effects of all noncash items included in the calculation of net income. c) is using the direct method. d) will add all noncash items not included in the calculation of net income. e) None of the above.