.Assume that Corporation X has 20,000 shares of $10 par value cumulative 6% preferred stock and 5,000 shares of common stock outstanding. No dividends were paid in 2009 and 2010. In 2011, the board of directors declares dividends of $50,000. What is the total cash paid to the preferred stockholders in 2011? (Points : 1)

$12,000 $24,000 $36,000 Zero

Question 2.2.Mickey Mouse Co. announced a 2-for-1 stock split of its $20 par value common stock, which is currently trading for $60 per share. What is the new par value and the estimated market price of the stock after the split? What is the New Par Value and the Estimated market price of the stock? (Points : 1)

$10, $30 $20, $30 $10, $60 $40, $120

Question 3.3.Which of the following is FALSE? (Points : 1)

Accounts payable always require payment of interest. Notes and bonds require interest to be paid periodically. Vendors and suppliers help to finance operations. Most businesses maintain a normal amount of accounts payable.

Question 4.4.Stock dividends are: (Points : 1)

distributions of common stock to holders of common stock distributions of cash or other assets to shareholders normally recorded at the par value of the stock issued required of companies periodically, according to their corporate charters

Question 5.5.RR Inc. issued $100,000, 8%, 10-year bonds on January 1, 2008. The bonds were issued at a discount of $24,600. Using the straight-line method, what is the annual amount of interest expense for these bonds? (Points : 1)

$10,460 $8,000 $5,540 Cannot be determined from the information given

PART 2

1.Preferred stockholders must receive their current-year dividends before the common stockholders can receive any dividends. (Points : 1)

True False

Question 2.2.In which section of the balance sheet would treasury stock be reported? (Points : 1)

Fixed assets Long-term liabilities Stockholders' equity Intangible assets

Question 3.3.The par value of common stock is rarely equal to its market value on the date the stock is issued. (Points : 1)

True False

Question 4.4.If bonds are issued at a premium, the stated interest rate is: (Points : 1)

higher than the market rate of interest. lower than the market rate of interest. too low to attract investors. adjusted to a higher rate of interest.

Question 5.5.When the market rate of interest on bonds is equal to the contract rate, the bonds will sell at: (Points : 1)

a premium. their face value. a discount. a discount or a premium.