Chapter 14 Homework - Chapter 14 Homework. 1. Par value [A]...

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Chapter 14 Homework. 1. Par value [A] represents the original selling price for a share of stock. [B] is the legal capital established for a share of stock. [C] represents what a share of stock is worth. [D] is established for a share of stock after it is issued. 2. The start-up and organization costs of a corporation should be [A] avoided before receiving a charter from the state. [B] written off as an expense when incurred. [C] recorded as an intangible asset and amortized over a reasonable length of time. [D] recorded and maintained as an intangible asset for the life of the corporation. 3. Start-up and organization costs [A] appear on the balance sheet as a current asset. [B] are capitalized and amortized, usually over five years. [C] are capitalized, but never amortized. [D] are expensed in the year incurred. 4. Compensation expense related to employee stock option plans is to be measured by the excess of the [A] option price over the market price of the stock at the date the options are exercised. [B] option price over the market price of the stock at the date the options are granted. [C] market price of the stock over the option price at the date the options are granted. [D] market price of the stock over the option price at the date the options are exercised. 5. The number of shares of issued stock equals [A] outstanding shares plus treasury shares. [B] unissued shares minus authorized shares. [C] subscribed shares plus outstanding shares. [D] authorized shares minus treasury shares. 6. Treasury shares plus outstanding shares equal [A] subscribed shares. [B] unissued shares. [C] authorized shares. [D] issued shares. 7. The maximum number of shares of common stock that may be issued according to the corporation’s charter is referred to as [A] issued shares. [B] outstanding shares. [C] unissued shares. [D] authorized shares.
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8. All of the following normally are found in a corporation’s stockholders’ equity section except [A] Paid-in Capital in Excess of Par Value. [B] Dividends in Arrears. [C] Retained Earnings. [D] Common Stock. 9. Holders of preferred stock normally do not have [A] ownership interests in the corporation. [B] preference as to dividends. [C] preference as to assets in liquidations. [D] full voting rights. Use the following information to answer the question(s) below. The following accounts appear in the ledger of Sayre Corporation on December 31, 20xx: Preferred Stock Common Stock Paid -in Capital in Excess of Par Value, Preferred Paid -in Capital in Excess of Par Value, Common Retained Earnings $30,000 60,000 7,000 18,000 40,000 10. A balance sheet prepared on December 31, 20xx, would report total contributed capital of [A] $90,000. [B] $97,000.
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This note was uploaded on 04/09/2008 for the course ACCT 112 taught by Professor King during the Spring '08 term at Howard County Community College.

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Chapter 14 Homework - Chapter 14 Homework. 1. Par value [A]...

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