1. The Logan Company issued 140 shares of its $12 par value stock for $14 per share. The entry to record the receipt of cash and issuance of the stock would include a

A. debit to Cash for $1,680 and a credit to Common Stock for $1,680.

B. debit to Cash for $1,960.

C. credit to Common Stock for $1,960.

D. debit to Discount on Common Stock for $280

2. Dividends in arrears occur when the company doesnt pay dividends to

A. cumulative preferred stockholders.

B. noncumulative preferred stockholders.

C. participating preferred stockholders.

D. nonparticipating common stockholders.

3. Alpha Corporation has 1,500 shares of $40 par, 7% cumulative preferred stock, and 2,200 shares of $10 par common stock. Alpha paid $10,000 in cash dividends, including one-year dividends in arrears to preferred stockholders. Common stockholders received

A. $0.

B. $220.

C. $1,600.

D. $5,800

4. When stock is exchanged for noncash assets,

A. debit the asset for prior book value and credit Common Stock for cash received.

B. debit assets for market value and credit Common Stock for par value; if needed, credit Paid-In Capital in Excess of Par.

C. debit assets for market value and credit Common Stock for market value.

D. debit assets for par value and credit Common Stock for par value.

5. ABC sells 400 shares of its $23 par common stock for $27. The entry would entail credit(s) to

A. Cash for $9,200.

B. Paid-In Capital in Excess of ParCommon for $800 and Common Stock for $10,800.

C. Paid-In Capital in Excess of ParCommon for $1,600 and Common Stock for $9,200.

D. Common Stock for $10,800.

6. The entry to record selling 300 shares of no-par common stock with a stated value of $60 for $70 would be which of the following?

A. Debit Cash $21,000; credit Common Stock $21,000

B. Debit Cash $18,000; credit Common Stock $18,000

C. Debit Cash $21,000; credit Common Stock $18,000; debit Paid-In Capital in Excess of Par ValueCommon $3,000

D. Debit Cash $21,000; credit Common Stock $18,000; credit Paid-In Capital in Excess of Stated ValueCommon $3,000

7. Five hundred shares of $25 par common stock was exchanged for a piece of equipment with a fair market value of $13,500. The journal entry to record the transaction would include a

• A. credit to Equipment for $12,500.
• B. debit to Common Stock for $12,500.
• C. credit to Paid-In Capital in Excess of ParCommon for $1,000.
• D. credit to Common Stock for $13,500.

8. Rhubarb Corporations outstanding stock is 100 shares of $100, 11% cumulative nonparticipating preferred stock, and 2,000 shares of $12 par value common stock. Rhubarb paid $1,600 cash dividends during the year. Common stockholders received

• A. $0.
• B. $500.
• C. $2,500.
• D. $1,100.

9. Stockholders investment appears in

• A. Paid-In Capital.
• B. Owners Equity.
• C. Retained Earnings.
• D. Cash.

10. The entry to record MidIowa.nets selling 800 shares of $6.00 par value common stock at $8.00 would be which of the following?

• A. Debit Cash $6,400; credit Common Stock $4,800; credit Paid-In Capital in Excess of Par ValueCommon $1,600
• B. Debit Cash $4,800; credit Common Stock $4,800
• C. Debit Cash $6,400; debit Paid-In Capital in Excess of Par ValueCommon $1,600; credit Common Stock $8,000
• D. None of the above

11. Dollys Best issued 200 shares of its $10 common stock in exchange for used packaging equipment with a fair market value of $2,400. The entry to record the acquisition of the equipment would include a

• A. debit to Equipment for $2,000.
• B. debit to Paid-In Capital in Excess of Par for $400.
• C. credit to Common Stock for $2,400.
• D. debit to Equipment for $2,400.

12. The ownership of a corporation consists of the

• A. governing body.
• B. officers of the corporation.
• C. stockholders.
• D. board of directors.

13. Sunrise Online issued 500 shares of its $10 common stock in exchange for equipment with a fair market value of $7,500. The entry to record the transaction would include a

• A. debit to Equipment for $5,000.
• B. debit to Common Stock for $5,000.
• C. credit to Paid-In Capital in Excess of Par Value for $2,500.
• D. credit to Common Stock Subscribed for $5,000.

14, A major disadvantage of a corporation is the

• A. difficulty in transferring ownership.
• B. limited life.
• C. difficulty in raising capital.
• D. double taxation of the corporations income and of dividends paid to shareholders.

15, Custer.coms outstanding stock is 100 shares of $100, 6% cumulative nonparticipating preferred stock, and 1,000 shares of $10 par value common stock. Custer paid $2,000 cash dividends, including one-year dividends in arrears to preferred stockholders. Common stockholders received

• A. $0.
• B. $800.
• C. $1,818.
• D. $600.

16. In exchange for $1,500 legal services to help set up the new company, Hickory Grove Corporation issued 100 shares of $10 par value stock to its attorney. The entry to record the issuance of the stock would include a

• A. credit to Common Stock for $1,000.
• B. debit to Common Stock for $1,000.
• C. credit to Common Stock for $1,500.
• D. debit to Paid-In Capital in Excess of Par Value for $500.

17. Soy.com has 100 shares of $100, 6% cumulative nonparticipating preferred stock, and 1,000 shares of $10 par value common stock outstanding. The company paid $2,000 cash dividends, including one-year dividends in arrears to preferred stockholders. Preferred stockholders received

• A. $1,200.
• B. $2,000.
• C. $182.
• D. $600.

18. Antiques.coms outstanding stock is 75 shares of $60, 8% cumulative nonparticipating preferred stock, and 2,000 shares of $10 par value common stock. Antiques paid $2,400 cash dividends during the year. Common stockholders received

• A. $2,400.
• B. $360.
• C. $2,040.
• D. $0.

19. Preferred stock thats given a right to share with the common stock in dividends in excess of a stated preferred dividend rate is called

• A. nonparticipating.
• B. participating.
• C. cumulative.
• D. noncumulative.

20. Officers of the corporation are

• A. appointed by the stockholders.
• B. stockholders of the corporation.
• C. appointed by the board of directors.
• D. None of the above