Question

In: Accounting

The date on which cash dividends are paid is the a.date of declaration. b.last day of...

The date on which cash dividends are paid is the

a.date of declaration.

b.last day of the fiscal year-end.

c.date of payment.

d.date of record.

Steak Company acquired a building valued at $170,000 for property tax purposes in exchange for 10,000 shares of its $5 par common stock. The stock is widely traded and selling for $16 per share. At what amount should the building be recorded by Steak Company?

a.$50,000

b.$200,000

c.$160,000

d.$170,000

Which of the following statements concerning taxation is accurate?

a.Corporations pay federal income taxes but not state income taxes.

b.Corporations pay income taxes, but their stockholders do not.

c.Only the stockholders must pay taxes on corporate income.

d.Corporations pay federal and state income taxes.

Which of the following is not true of a corporation?

a.It may enter into binding legal contracts in its own name.

b.It may buy, own, and sell property.

c.The owners are personally liable for corporate actions.

d.It may sue and be sued.

Which of the following is not a term used to refer to owners' equity in a corporation?

a.Stockholders' equity

b.Capital

c.Shareholders' investment

d.Members' equity

If a corporation has only one class of stock, the account is entitled Common Stock or

a.Capital Stock.

b.Owners' Stock.

c.Member Stock.

d.Preferred Stock.

The entry to record the issuance of common stock at a price above par includes a credit to

a.Organizational Expenses.

b.Paid-In Capital in Excess of Par—Common Stock.

c.Cash.

d.Preferred Stock.

The number of shares of stock that a corporation can issue as stated in its charter is referred to as

a.outstanding.

b.authorized.

c.arrears.

d.issued.

When a cash dividend is declared, which of the following accounts is credited?

a.Common Stock

b.Cash Dividends

c.Cash Dividends Payable

d.Paid-In Capital

Aaron Company has 80,000 shares of $10 par common stock outstanding. On May 25, Aaron Company declared a $1.50 cash dividend. The market price of the stock on May 25 was $17 per share. The journal entry to record the cash dividend would include

a.a debit to Cash for $560,000.

b.a credit to Paid-In Capital in Excess of Par—Common Stock for $560,000.

c.a debit to Cash Dividends for $120,000.

d.All of these choices are correct.

Solutions

Expert Solution

1. (C) Date of payment

The three important dates are the date of declaration, the date of record, and the date of payment. The date of payment is the date the corporation will pay the dividend to the stockholders who owned the stock on the date of record.

2) Option (C) $160,000

An asset exchange for stock is value at the verifiable market value. A property tax evaluation would not really be considered a market value. A widely traded stock value would be a market value would be a market value and should be used to record the asset.

3) Option (D) corporations pay federal and state incomes taxes.

4) Option (C) The owners are personally liable for corporate actions.

A major advantage ofthe corporate structure is thatowners are not liable forcorporate actions.

5) Option (D) Members equity

6) Option (a) Capital Stock

7) Option (B) Paid-In Capital in Excess of Par—Common Stock.

8) Option (B) Authorized

9) Option (C) Cash Dividends Payable

10) Option (C) a debit to Cash Dividends for $120,000

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Labels and Amount Descriptions Cash paid for dividends Cash paid for purchase of equipment Cash paid...

Labels and Amount Descriptions Cash paid for dividends Cash paid for purchase of equipment Cash paid for purchase of land Cash paid for purchase of treasury stock Cash payments for income taxes Cash payments for merchandise Cash payments for operating expenses Cash received from customers Cash received from sale of common stock Cash received from sale of investments Change in cash December 31, 20Y6 Depreciation For the Year Ended December 31, 20Y6 Gain on sale of investments Issuance of common...

Please provide answers. 5. The declaration and payment of cash dividends a.reduces the amount of resources...

Please provide answers. 5. The declaration and payment of cash dividends a.reduces the amount of resources a company has to invest in productive assets. b.sometimes does not reduce a company's cash balance. c.sometimes does not reduce a company's retained earnings balance. d.reduces a company's net income. 6. The declaration of a common cash dividend a.decreases the number of shares of outstanding stock. b.decreases a company's retained earnings balance. c.decreases the amount of cash. d.decreases the par value of outstanding stock....

Cash at beginning of period $74 Cash receipts from customers O+ 215 Dividends paid 12 Dividends...

Cash at beginning of period $74 Cash receipts from customers O+ 215 Dividends paid 12 Dividends received 9 Interest paid 7 Issuance of stocks 75 Loans made to borrowers 65 Payments of dividends 30 Payments to vendors and payroll 155 Proceeds from short-term borrowing 22 Purchase of land 35 Receipts of interest 10 Redemption of long term liabilities 80 Sale of building 26 Taxes paid 15 Please fill in codes: ) +, O -,I +, I-, F +, F- Calculate:...

Record the entry for the declaration of dividends ( not payment) for each of the four...

Record the entry for the declaration of dividends ( not payment) for each of the four separate scenarios. On April 1, 2020 Apex Corporation declared a cash dividend of $5.00 per share on its 32,000 outstanding shares of common stock ($1 par). The dividend is payable on April 21, 2018, to stockholders of record on April 20, 2018. Axe Co. has issued and outstanding 1,000 shares of $100 par, cumulative, 5% preferred stock and 20,000 shares of $5 par common...

1. Match the terms with the definitions. date of declaration date of record dividend retained earnings...

1. Match the terms with the definitions. date of declaration date of record dividend retained earnings appropriation retained earnings statement stock dividend stock split cash dividend date of payment 10. bond The date on which the board of directors declares that a dividend is to be paid. A proportionate distribution of shares of a corporation's own stock to its stockholders. A distribution of earnings by a corporation to its stockholders. A restriction of retained earnings by the board of...

Date - month: int - day: int - year: int +Date() +Date(month: int, day: int, year:...

Date - month: int - day: int - year: int +Date() +Date(month: int, day: int, year: int) +setDate(month: int, day: int, year: int): void -setDay(day: int): void -setMonth(month: int): void -setYear(year: int): void +getMonth():int +getDay():int +getYear():int +isLeapYear(): boolean +determineSeason(): string +printDate():void Create the class Constructor with no arguments sets the date to be January 1, 1900 Constructor with arguments CALLS THE SET FUNCTIONS to set the Month, then set the Year, and then set the Day - IN THAT ORDER...

Calculate the annual cash dividends required to be paid for each of the following preferred stock...

Calculate the annual cash dividends required to be paid for each of the following preferred stock issues: Required: $4.00 cumulative preferred, no par value; 290,000 shares authorized, 129,000 shares issued. (The treasury stock caption of the stockholders' equity section of the balance sheet indicates that 40,713 shares of this preferred stock issue are owned by the company.) (Round your answer to 2 decimal places.) 5%, $50 par value preferred, 214,000 shares authorized, 156,000 shares issued, and 72,734 shares outstanding. (Round...

On December 1 of the current year (the declaration date), Z’s board of directors vote to...

On December 1 of the current year (the declaration date), Z’s board of directors vote to pay a $600 distribution by mailing checks on December 31 of the current taxable year (the payment date) to shareholders of record on December 15 (the record date). The checks are actually received by shareholders on January 2. Shareholder C is an individual with a stock basis of $120. C sells his stock on December 10 for $1,620. a. The distribution by the corporation...

Question 26 A paid dividend Question 26 options: Credits cash and debits dividends Credits cash and...

Question 26 A paid dividend Question 26 options: Credits cash and debits dividends Credits cash and dividends Debits cash and credits dividends Debits cash and dividends Question 27 Performance of a service results in Question 27 options: a credit to an asset and revenues a credit to an asset and a debit to revenues a debit to an asset and revenues a debit to an asset and a credit to revenues Question 28 Taking out a loan results in Question...

On 1 July 2017, Cambridge Ltd paid $250,000 cash to acquire a machine. On this date...

On 1 July 2017, Cambridge Ltd paid $250,000 cash to acquire a machine. On this date it was estimated that the machine had a useful life of ten years and a residual value of $30,000. In accordance with AASB 116 Property, Plant and Equipment, Cambridge Ltd uses the revaluation model as its accounting policy to measure items of property, plant and equipment and the straight-line method of depreciation. Cambridge Ltd has a 30 June reporting date. An independent valuer provided...

Subjects