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Chapter 10 Multiple Choice Answers

Chapter 10 Multiple Choice Answers - 1,000 Paid-in excess...

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1. CHAPTER 10 - MULTIPLE-CHOICE EXERCISES 10–1 a 10–2 d 10–3 a 10–4 d Total stock issued ($37,500 ÷ $0.50) ................. 75,000 shares Less: Treasury stock .......................................... 5,000 shares Total stock outstanding ..................................... 70,000 shares 10–5 c 10–6 d 2,400 shares × $20/share = $48,000 increase to stockholders’ equity Cash .............................................................................. $48,000 Common stock (2,400 × $2 par) ................................ 4,800 Paid-in excess of par—common stock (2,400 × $18) .............................................................. $ 43,200 10–7 c Prepaid rent ($2,400 × 24 months) ............................. $ 57,600* Common stock (1,000 shares × $1 par)
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Unformatted text preview: ................... 1,000 Paid-in excess of par—common stock. .................... $ 56,600 *For newly organized or closely held corporations, the fair market value of the asset/service is usually more readily determinable than the fair market value of the stock. 10–8 b 10–9 b 10–10 d 10–11 a 10–12 d 10–13 b 10–14 d 10–15 c 10–16 d $30 market price ÷ 3 = $10 per new share 10–17 a 10–18 a Preferred dividends: 2008 (in arrears): (20,000 × $40) × 5% = $40,000 2009: (20,000 × $40) × 5% = $40,000 $150,000 – $80,000 = $70,000 left over for dividends to common shareholders. 10–19 d 10–20 a 10–21 a $100,000 ÷ $200,000 = 0.5...
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