Accounting Final Exam Review

Accounting Final Exam Review - Final Exam – 60 multiple...

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Unformatted text preview: Final Exam – 60 multiple choice questions Chapter 10 - 2 Questions on Theory • If bonds issued are greater than market rate, then there is a premium at more maturity • If bonds issued are lower than market rate, then there is a discount at less maturity • Par value – no discount or premium, it is issued at market rate • Principle or maturity value is the amount the borrower must pay back to the bondholder • Term bonds – mature same date Serial bonds – mature in installments Secured – if interest is not paid, bondholder has right to assets Debenture - unsecured, not backed by assets Convertible bonds – bonds that may be converted into common stock • Bonds – must pay interest, reduces net income, can increase earnings per share • Stock – don’t have to pay off, doesn’t affect net income, increases number of outstanding shares Chapter 11 - 5 Questions on Theory and calculations • Paid in Capital – amounts received from stockholders, common stock is main source • Retained Earnings – internal generated from profitable operations • Common – basic form of stock Preferred Stock – receive dividends and assets before CS, no right to vote • Preferred Stock par value per share = preferred stock ÷ # of shares issued • Preferred Stock dividend = preferred stock shares x par value X dividend rate • Common Stock dividend = total dividend (PS issued) – preferred stock dividend • Paid in Capital = (shares x price per share) – shares • Total Paid in Capital = PS + CS + Additional Paid in Capital • Common Equity = Total Stockholder’s equity – Preferred Equity • Preferred equity = Par value of stock + preferred dividends • Book value per share = Common equity ÷ common shares outstanding...
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This note was uploaded on 12/05/2010 for the course BUS BUS taught by Professor Fox during the Fall '10 term at University of Baltimore.

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Accounting Final Exam Review - Final Exam – 60 multiple...

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