47)J and K formed a partnership in which J contributes $60,000 in assets and agrees to devote K contributed $40,000 in assets and agrees to devote full-time to half-time to the business. the partnership. If no other information is available, how will J and K share in the division of income? a) 3:2 e) 2:3 d) 1:2 48) When a partnership goes out of business, the winding up process is generally called: a) Liquidation b) Capitalization c) Realization d) Revaluation 49) A loss on realization occurs when: a) Assets are sold at their book value b) Assets are sold below their book value c) Assets are sold above their book value d) None of the above 50) The entry to record the issuance of 150 shares of $5 par common stock at par to an attorney in payment of legal fees for organizing the corporation includes a debit to a) Organizational Expenses b) Goodwill c) Common Stock d) Cash 51) The liability for a cash dividend is recorded on which of the following dates? a) The date of declaration The date of record b) c) The date of payment The date of announcement d) 52) When a cash dividend is declared, which of the following accounts would be debited? a) Retained Earnings b) Cash Dividends c) Stock Dividends d) Cash Dividends Payable 53) The net effect to a corporation of the declaration and payment of a cash dividend is to a) Decrease assets and decrease stockholders' equity b) Decrease liabilities and decrease stockholders' equity c) Increase stockholders' equity and decrease liabilities d) Increase assets and increase stockholders' equity 54) The effect of the declaration and issuance of the stock dividend when the share price is greater than par value is to: a) increase retained earnings, decrease common stock, and decrease paid-in capital b) decrease retained earnings, increase common stock, and increase paid-in capital c) increase retained earnings, decrease common stock, and increase paid-in capital d) decrease retained earnings, increase common stock, and decrease paid-in capital 55) The Bonds Payable, Premium on Bonds Payable and Discount on Bonds Payable accounts have normal balances of a a) Debit, debit, credit b) Credit, credit, debit c) Credit, credit, credit d) Debit, debit, debit 56) When bonds are issued at more than face value, the carrying value of the bonds is equal to a) Face value b) Face value plus unamortized discount c) Face value minus unamortized premium d) Face value plus unamortized premium 57) Net income divided by total shares of common stock outstanding (assume no preferred stock) will result in a figure termed: a) Dividends per share b) Price-earnings ratio. c) Dividend yield. d) Earnings per share. 58) A company owns 8.000 of the 25,000 shares of common stock outstanding of Trailer Company and exercises a significant influence over its operating and financial policies. The investment should be accounted for by the: a) Cost method. b) Equity method. c) Market method d) Lower of cost or market method. 59) The receipt of cash dividends on a long-term investment in common stock is accounted for as a debit to Cash and a credit to Investment in Space Inc. Which of the following methods is being used to account for the investment? a) Equity method b) Market method c) Cost method d) Revenue method 60) The receipt of cash dividends on a long-term investment in common stock is accounted for as a debit to Cash and a credit to Dividend Income. Which of the following methods is being used to account for the investment? a) Equity method b) Market method c) Cost method d) Revenue method 61) When shares of stock held as a long-term investment are sold, if the proceeds received from the sale of the investment are greater than the carrying amount of the investment this difference is recorded as a: a) Premium b) Discount e) Loss on sale of investment d) Gain on sale of investment