Question 1

When a stockholder contributes cash to a corporation in exchange for stock,________.

Accepted Answer

When a stockholder contributes cash to a corporation in exchange for stock, assets and stockholders' equity are increased. The cash received is recorded as an asset, and the stock issued is recorded as stockholders' equity. Liabilities are not affected by this transaction.

Question 2

Accounting for stated value common stock is identical to accounting for par value stock.

Accepted Answer

The stated value stock uses an account titled Paid-In Capital in Excess of Stated.

Question 3

The following information is from the December 31,2017 balance sheet of Jackson Corporation.

What is the average issue price of the preferred stock shares? (Round answers to the nearest dollar. )

Accepted Answer

A)
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Question 4

Preferred Stock is included in the long-term asset section of the balance sheet.

Accepted Answer

Preferred Stock is included in the stockholders' equity section of the balance sheet

Question 5

Lerner,Inc.had the following transactions in 2017,its first year of operations:
• Issued 25,000 shares of common stock.The stock has a par value of $2.00 per share and was issued at $14.00 per share.
• Issued 1,700 shares of $150 par value preferred stock at par.
• Earned net income of $36,000.
• Paid no dividends.
At the end of 2017,what is total stockholders' equity?

Accepted Answer

A)
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Question 6

Peterson,Inc.issued 4,000 shares of preferred stock for $280,000.The stock has a par value of $70 per share.The journal entry to record this transaction would ________.

Accepted Answer

D)
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Question 7

On December 2,2017,St.Augustine,Inc.purchases land.In exchange for the land,St.Augustine,Inc.issues 8,000 shares of common stock with $1.00 par value.The land has been appraised at a market value of $400,000.Prepare the journal entry for this transaction.

Accepted Answer

The answer of On December 2,2017,St.Augustine,Inc.purchases land.In exchange for the...

Question 8

When stock is issued for assets other than cash,the transaction is recorded at the market value of the stock issued or the market value of the assets received,whichever is more clearly determinable.

Accepted Answer

This is in accordance with accounting standards that require the use of the fair value of assets and liabilities in transactions. The market value of the stock issued or the market value of the assets received, whichever is more clearly determinable, is used to record the transaction.

Question 9

When a corporation issues no-par stock,it debits the asset received and credits the stock account.

Accepted Answer

When a corporation issues no-par stock, it records the receipt of assets in the Assets account (debit) and records the issuance of stock in the Stock account (credit).

Question 10

The following information is from the December 31,2017 balance sheet of Tudor Corporation.

What was the total paid-in capital as of December 31,2017?

Accepted Answer

C)
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Question 11

Jenkins Realty,Inc.issued 13,000 shares of $1 stated value common stock for $13 per share.The journal entry to record this transaction includes a credit to ________.

Accepted Answer

The credit to "Paid-In Capital in Excess of Stated - Common" is for the amount received above the stated value, which is ($13 - $1) * 13,000 shares = $156,000.

Question 12

Castle,Inc.had the following transactions in 2017,its first year of operations:
• Issued 22,000 shares of common stock.The stock has a par value of $4.00 per share and was issued at $20.00 per share.
• Issued 1,200 shares of $160 par value preferred stock at par.
• Earned net income of $40,000.
• Paid no dividends.
At the end of 2017,what is the total amount of paid-in capital?

Accepted Answer

D)
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Question 13

On December 2,2017,Ewell,Inc.purchases land.In payment for the land,Ewell,Inc.issues 10,000 shares of common stock with $8 par value.The land has been appraised at a market value of $490,000.Which of the following is included in the journal entry to record this transaction?

Accepted Answer

B)
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Question 14

Dallkin Corporation issued 8,000 shares of common stock on January 1,2017.The stock has no par value and was issued at $22 per share.The journal entry for this transaction includes a ________.

Accepted Answer

When stock with no par value is issued, the entire proceeds are credited to the common stock account.

Question 15

A corporation issues 14,000 shares of its $4 stated value common shares.The issue price is $7 per share.The credit to the Common Stock account is $98,000.

Accepted Answer

Common Stock is credited for the 14,000 shares issued times the $4 stated value ($56,000).

Question 16

When stock is issued for assets other than cash,the transaction is always recorded at the market value of the stock issued.

Accepted Answer

When stock is issued for assets other than cash,the transaction is recorded at the market value of the stock issued or the market value of the assets received,whichever is more clearly determinable.

Question 17

For no-par stock there can be paid-in capital in excess of par.

Accepted Answer

For no-par stock,there can be no paid-in capital in excess of par.

Question 18

If preferred stock is issued for an amount above the par value,the amount of the par value times the number of shares issued is credited to Paid-In Capital in Excess of Par-Preferred.

Accepted Answer

The amount is credited to Preferred Stock.

Question 19

Osbourne,Inc.issued 50,000 shares of common stock in exchange for manufacturing equipment.The equipment has a fair value of $1,210,000.The stock has a par value of $0.02 per share.The journal entry to record this transaction includes a ________.

Accepted Answer

C)
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Question 20

When 9,000 shares of $8 stated value common stock is issued at $13 per share,________.

Accepted Answer

When a stock is issued for more than its stated value, the difference between the issue price and the stated value is credited to the account titled Paid-In Capital in Excess of Stated. In this case, the total amount received from issuing 9,000 shares of $8 stated value common stock at $13 per share would be $117,000. The Common Stock - $8 Stated account would be credited for $72,000 (9,000 shares x $8 stated value), and the remaining $45,000 ($117,000 - $72,000) would be credited to Paid-In Capital in Excess of Stated. This method is different from the accounting for par value stock, which has a fixed value per share that cannot be exceeded.

Quiz 13: Corporations

When a stockholder contributes cash to a corporation in exchange for stock,________.

Accounting for stated value common stock is identical to accounting for par value stock.

The following information is from the December 31,2017 balance sheet of Jackson Corporation. What is the average issue price of the preferred stock shares? (Round answers to the nearest dollar. )

Preferred Stock is included in the long-term asset section of the balance sheet.

Peterson,Inc.issued 4,000 shares of preferred stock for $280,000.The stock has a par value of $70 per share.The journal entry to record this transaction would ________.

On December 2,2017,St.Augustine,Inc.purchases land.In exchange for the land,St.Augustine,Inc.issues 8,000 shares of common stock with $1.00 par value.The land has been appraised at a market value of $400,000.Prepare the journal entry for this transaction.

When stock is issued for assets other than cash,the transaction is recorded at the market value of the stock issued or the market value of the assets received,whichever is more clearly determinable.

When a corporation issues no-par stock,it debits the asset received and credits the stock account.

The following information is from the December 31,2017 balance sheet of Tudor Corporation. What was the total paid-in capital as of December 31,2017?

Jenkins Realty,Inc.issued 13,000 shares of $1 stated value common stock for $13 per share.The journal entry to record this transaction includes a credit to ________.

On December 2,2017,Ewell,Inc.purchases land.In payment for the land,Ewell,Inc.issues 10,000 shares of common stock with $8 par value.The land has been appraised at a market value of $490,000.Which of the following is included in the journal entry to record this transaction?

Dallkin Corporation issued 8,000 shares of common stock on January 1,2017.The stock has no par value and was issued at $22 per share.The journal entry for this transaction includes a ________.

A corporation issues 14,000 shares of its $4 stated value common shares.The issue price is $7 per share.The credit to the Common Stock account is $98,000.

When stock is issued for assets other than cash,the transaction is always recorded at the market value of the stock issued.

For no-par stock there can be paid-in capital in excess of par.

If preferred stock is issued for an amount above the par value,the amount of the par value times the number of shares issued is credited to Paid-In Capital in Excess of Par-Preferred.

Osbourne,Inc.issued 50,000 shares of common stock in exchange for manufacturing equipment.The equipment has a fair value of $1,210,000.The stock has a par value of $0.02 per share.The journal entry to record this transaction includes a ________.

When 9,000 shares of $8 stated value common stock is issued at $13 per share,________.