PROBLEM 1CLASSIFICATION OF CORPORATE ACCOUNTS24%

INSTRUCTIONS: Identify each of the items listed below as an asset, liability, stockholders equity, revenue, or expense, and indicate the normal balance of each account.

	Answers			For
	Item	Balance		Scoring
0. Common Stock ...................................................................................................	stockholders equity	credit		0. ____
1. Organization Costs ............................................................................................				1. ____
2. Paid-In Capital in Excess of ParPreferred Stock ......................................				2. ____
3. Retained Earnings .............................................................................................				3. ____
4. Treasury Stock ...................................................................................................				4. ____
5. Preferred Stock ..................................................................................................				5. ____
6. Stock Dividends Distributable ..........................................................................				6. ____

PROBLEM 2ANALYSIS OF CORPORATE TRANSACTIONS30%

INSTRUCTIONS: Selected corporation transactions are listed below. For each transaction, indicate the account(s) to be debited and credited by inserting in the appropriate column the letter(s) that correspond to the accounts listed below. (Do not record amounts.)

ACCOUNTS

A. Cash H. Paid-In Capital in Excess of ParPreferred Stock

B. Cash Dividends I. Preferred Stock

C. Cash Dividends Payable J. Retained Earnings

D. Common Stock K. Stock Dividends

E. Organization Cost Expense L. Stock Dividends Distributable

F. Paid-In Capital from Sale of Treasury Stock M. Treasury Stock

G. Paid-In Capital in Excess of ParCommon Stock

		For		For
TRANSACTIONS	Debit	Scoring	Credit	Scoring
0. Issued 10,000 shares of $10 par common stock at $120, receiving cash	A	0. ____	D, G	0. ____
1-2. Issued 300 shares of $25 par preferred stock with a fair value of $30 per share to an attorney in payment of legal fees for organizing the corporation ...........................................................................................................		1. ____		2. ____
3-4. Declared a stock dividend of 7,000 shares of $100 par common stock; fair market value is $150 per share ................................................................		3. ____		4. ____
5-6. Issued stock dividend declared in Question 3-4 ...........................................		5. ____		6. ____
7-8. Sold all 500 shares of treasury stock that was originally purchased at $29 for $35, receiving cash ..............................................................................		7. ____		8. ____
9-10. Acquired treasury stock for $20 per share. It had originally been $10 par common stock issued at $16 per share ..................................................		9. ____		10. ____
11-12. Declared a cash dividend on common stock .................................................		11. ____		12. ____