What was the average issue price of the common stock shares

User Generated

lhatserr07

Business Finance

Description

List of accounting questions. All question are attached to the document.

Unformatted Attachment Preview

1) Which of the following is included in the entry to record the issuance of 14,000 shares of $7 par value common stock at $21 per share cash? A) Cash is debited for $294,000. B) Common Stock is debited for $98,000. C) Common Stock is credited for $294,000. D) Paid-In Capital in Excess of Par—Common is debited for $196,000. 2) The following information is from the December 31, 2017 balance sheet of Lawson Corporation. Preferred Stock, $100 par Paid-In Capital in Excess of Par—Preferred Common Stock, $1 par Paid-In Capital in Excess of Par—Common Retained Earnings Total Stockholders' Equity $560,000 43,000 190,000 510,000 191,500 $1,494,500 What was the average issue price of the common stock shares? (Round your answer to the nearest cent.) A) $1.88 B) $1.00 C) $2.68 D) $3.68 3) Moretown, Inc. had the following transactions in 2017, its first year of operations: • Issued 31,000 shares of common stock. Stock has par value of $1.00 per share and was issued at $20.00 per share. • Earned net income of $70,000. • Paid no dividends. At the end of 2017, what is total stockholders' equity? A) $31,000 B) $690,000 C) $620,000 D) $70,000 4) When 1,000 shares of $3 stated value common stock is issued at $18 per share, ________. A) Common Stock — $3 Stated is credited for $18,000 B) the account titled Paid-In Capital in Excess of Stated is used to record the issue price of the stock C) the difference between the issue price and the stated value is credited to Paid-In Capital in Excess of Stated D) the accounting is exactly the same as the accounting for par value stock 5) On December 2, 2017, Ewell, Inc. purchases land. In payment for the land, Ewell, Inc. issues 6,000 shares of common stock with $6 par value. The land has been appraised at a market value of $430,000. Which of the following is included in the journal entry to record this transaction? A) debit Common Stock—$6 Par Value for $36,000 and debit Paid-In Capital in Excess of Par —Common $394,000 B) credit Common Stock—$6 Par Value for $36,000 and credit Paid-In Capital in Excess of Par—Common $394,000 C) credit Common Stock—$6 Par Value for $430,000 D) debit Cash $430,000 6) Osbourne, Inc. issued 60,000 shares of common stock in exchange for manufacturing equipment. The equipment has a fair value of $1,420,000. The stock has a par value of $0.05 per share. The journal entry to record this transaction includes a ________. A) debit to Cash for $14,170,000 B) credit to Gain on Sale of Common Stock for $1,480,000 C) credit to Paid-In Capital in Excess of Par—Common for $1,417,000 D) credit to Common Stock—$0.05 Par Value for $1,420,000 7) Orange Office Supply Corporation completed the following stock issuance transactions: Issued 5,000 shares of $4 stated value common stock for cash of Mar. 28 $20 per share Received merchandise inventory with a market value of $46,000 in exchange for 2,000 shares of the $4 stated value common May 1 stock. Issued 450 shares of 5%, $20 par value preferred stock for $50 May 14 per share Prepare the journal entries to record these transactions. Explanations are not required. 8) Define treasury stock and provide two reasons why a corporation would purchase treasury stock. 9) Treasury stock ________. A) decreases the number of shares issued B) increases the number of shares issued C) increases the number of shares outstanding D) decreases the number of shares outstanding 10) Assume the following information for Petra Sales, Inc.: • • • • Common Stock, $1.00 par, 232,000 shares issued, 186,000 shares outstanding Paid-In Capital in Excess of Par—Common: $1,770,000 Retained Earnings: $2,450,000 Treasury Stock: 26,000 shares purchased at $12 per share If Petra Sales purchases an additional 13,000 shares of treasury stock at $18 per share, what number of shares will be shown as issued and outstanding? A) 18 issued; 186,000 outstanding B) 219,000 issued; 186,000 outstanding C) 232,000 issued; 173,000 outstanding D) 232,000 issued; 186,000 outstanding 11) Supermart, Inc. completed the following treasury stock transactions in 2016: Mar. 3 Purchased 1,800 shares of the company's $ 3 par value common stock as treasury stock, paying cash of $ 10 per share. Mar. 17 Sold 400 shares of the treasury stock for cash of $ 12 per share. Mar. 25 Sold 600 shares of the treasury stock for cash of $ 7 per share. (Assume the balance in Paid-In Capital from Treasury Stock Transactions on March 24 is $ 1,200.) Journalize these transactions. Explanations are not required. How will Supermart, Inc. report treasury stock on its balance sheet as of December 31, 2016? 12) On the ________, cash dividends become a liability of a corporation. A) declaration date B) date of record C) last day of the fiscal year D) payment date 13) The entry to record the payment of a previously declared dividend of $0.25 per share on 18,500 shares of common stock includes a ________. A) debit to Cash Dividends for $4,625 B) debit to Cash $4,625 C) credit to Cash Dividends for $4,625 D) debit to Dividends Payable for $4,625 14) Dividends in arrears are ________. A) a liability on the balance sheet B) passed dividends on noncumulative preferred stock C) passed dividends on cumulative preferred stock D) passed dividends on common stock 15) Saturn Corporation has 13,000 shares of 14%, $84 par noncumulative preferred stock outstanding and 20,000 shares of no-par common stock outstanding. At the end of the current year, the corporation declares a dividend of $180,000. How is the dividend allocated between preferred and common stockholders? A) The dividend is allocated $8,107 to preferred stockholders and $109,091 to common stockholders. B) The dividend is allocated $152,880 to preferred stockholders and $27,120 to common stockholders. C) The dividend is allocated $70,909 to preferred stockholders and $109,091 to common stockholders. D) The dividend is allocated $235,200 to preferred stockholders and $55,200 to common stockholders. 16) Ramos Corporation reported the following equity section on its current balance sheet. The common stock is currently selling for $18.00 per share. Common Stock, $5 par, 194,000 shares authorized, 143,000 shares issued and outstanding Paid-In Capital in Excess of Par—Common Retained Earnings Total Stockholders' Equity $715,000 130,000 301,000 $1,146,000 After the declaration and distribution of a 20% stock dividend, what is the total number of common shares issued? A) 13,000 B) 160,160 C) 143,000 D) 17,160 17) Challenger Corporation currently has 120,000 shares outstanding of $1 par value common stock. The stock was originally issued for $12 per share. On March 15, the board of directors declares and distributes a 10% stock dividend when the stock is selling for $16 per share. Prepare the journal entry to record the stock dividend. 18) On December 1, 2017, Galahad, Inc. had 200,000 shares of $1 par value common stock issued and outstanding. The next day Galahad declared and distributed a 50% stock dividend. The market value of the stock on December 2, 2017 was $9 per share. Prepare the journal entry for the transaction. 19) Which of the following occurs when the board of directors declares a 3-for-1 stock split on 20,000 outstanding shares of $25 par common stock? A) The par value of the stock remains the same. B) The par value of the stock increases to $50 per share. C) The number of outstanding shares remains at 20,000. D) The number of outstanding shares increases to 60,000. 20) Raedy Corporation reported the following equity section on its current balance sheet. The common stock is currently selling for $20.25 per share. Common Stock, $5 par, 337,000 shares authorized, 157,000 shares issued and outstanding Paid-In Capital in Excess of Par—Common Retained Earnings Total Stockholders' Equity $785,000 140,000 301,000 $1,226,000 After a 2-for-1 stock split, what is the number of issued shares? A) 280,000 B) 314,000 C) 297,000 D) 140,000 21) ABC has 61,000 shares of $16.00 par common stock outstanding. ABC announces a stock split of 4-for1. What is the effect of the split? A) par stays at $16.00; total shares increase to 15,250 B) par drops to $8.00; total shares stay at 61,000 C) par drops to $4.00; total shares increase to 244,000 D) par goes to $64.00; total shares increase to 244,000 1) Which of the following is the typical order of the sections on a statement of cash flows? A) operating, financing, investing B) financing, investing, operating C) investing, operating, financing D) operating, investing, financing 2) Johnson Tires Company uses the indirect method to prepare the statement of cash flows. Refer to the following comparative balance sheet for Johnson Tires Company and complete the third column to show the increases or decreases. Johnson Tires Company Comparative Balance Sheet December 31, 2017 and 2016 Cash Accounts Receivable Merchandise Inventory Total Assets 2016 $39,600 26,400 204,000 270,000 2015 $19,800 38,500 126,500 184,800 Accounts Payable Accrued Liabilities Long-term Notes Payable Total Liabilities 4,800 2,400 100,800 108,000 6,600 1,100 99,000 106,700 Common Stock Retained Earnings Treasury Stock Total Stockholders' Equity 36,000 135,600 (9,600) 162,000 2,200 81,400 (5,500) 78,100 $270,000 $184,800 Total Liabilities and Stockholders' Equity Increase/ (Decrease) 3) Rodriguez Tint, Inc. uses the indirect method to prepare the statement of cash flows. Refer to the following income statement: Sales Revenue Rodriguez, Inc. Income Statement Year Ended December 31, 2017 $154,000 Interest Revenue Loss on Sale of Plant Assets 7,000 (5,400) Total Revenues and Gains Cost of Goods Sold Salary Expense Depreciation Expense Other Operating Expenses $155,600 130,000 21,000 7,400 13,400 Interest Expense 16,000 Income Tax Expense 6,000 Total Expenses 193,800 Net Income (Loss) $(38,200) Additional information provided by the company includes the following: Current assets, other than cash, decreased by $5,100. Current liabilities increased by $2,300. Compute the net cash provided by (used for) operating activities. A) $(18,000) B) $(45,600) C) $10,500 D) $23,400 4) Budget Auto Parts Company uses the indirect method to prepare the statement of cash flows. Refer to the following income statement: Budget Company Income Statement Year Ended December 31, 2017 Sales Revenue $360,000 Interest Revenue 1,500 Gain on Sale of Plant Assets 6,000 Total Revenues and Gains $367,500 Cost of Goods Sold 165,000 Salary Expense 67,500 Depreciation Expense 18,000 Other Operating Expenses 34,500 Interest Expense 1,500 Income Tax Expense 7,500 Total Expenses 294,000 Net Income (Loss) $73,500 Additional information provided by the company includes the following: Current assets other than cash increase by $36,000. Current liabilities decrease by $1,500. Prepare the operating activities section of the statement of cash flows. 5) Starfire Telescopes Company uses the indirect method to prepare the statement of cash flows. Refer to the following income statement: Starfire Telescopes Company Income Statement Year Ended December 31, 2017 Sales Revenue Interest Revenue Total Revenues Cost of Goods Sold Salary Expense Depreciation Expense Other Operating Expenses Interest Expense Income Tax Expense Loss on Sale of Plant Assets Total Expenses Net Loss $275,000 2,600 $277,600 135,000 66,500 32,000 35,900 2,400 6,500 2,000 280,300 ($2,700) Additional information provided by the company includes the following: Current assets other than cash decreased by $25,000. Current liabilities increased by $3,000. Prepare the operating activities section of the statement of cash flows. 6) Manning Tint, Inc. uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet: Manning Tint, Inc. Comparative Balance Sheet December 31, 2017 and 2016 2016 2015 Cash Increase/(Decrease) $28,000 $25,000 $3,000 Accounts Receivable 32,000 38,000 (6,000) Merchandise Inventory 55,000 25,000 30,000 Plant and Equipment 126,000 93,000 33,000 Accumulated Depreciation-Plant and Equipment (44,000) (45,000) (81,000) $197,000 $136,000 $141,000 Total Assets Additional information provided by the company includes the following: 1. Equipment was purchased for $66,000. 2. Equipment with a cost of $37,000 and accumulated depreciation of 7,200 was sold for $49,000. What was the amount of net cash provided by (used for) investing activities? A) $256,000 B) $17,000 C) $(256,000) D) $(17,000) 7) Which of the following sections of the statement of cash flows includes activities that increase and decrease long-term liabilities and stockholders' equity? A) the financing activities section B) the operating activities section C) the investing activities section D) the non-cash investing and financing section 8) Tritan Company is preparing its statement of cash flows using the indirect method. Refer to the following portion of the comparative balance sheet: Tritan Company Comparative Balance Sheet December 31, 2017 and 2016 2016 2015 Increase/(Decrease) Accounts Payable $7,000 $5,000 $2,000 Accrued Liabilities 3,500 1,100 2,400 56,000 67,000 $(11,000) $66,500 $73,100 $(6,600) Long-term Notes Payable Total Liabilities Additional information provided by the company includes the following: 1. During 2016, the company repaid $35,000 of long-term notes payable. 2. During 2016, the company borrowed $24,000 on a new note payable. Based on the above information only, what amount of net cash flow would be shown in the financing section of the statement of cash flows? A) $(11,000) B) $11,000 C) $59,000 D) $(59,000) 9) The issuance of common stock for cash is shown as a ________. A) negative cash flow in the investing activities section of the statement of cash flows B) positive cash flow in the investing activities section of the statement of cash flows C) negative cash flow in the financing activities section of the statement of cash flows D) positive cash flow in the financing activities section of the statement of cash flows 10) O'Brien Coatings Company uses the indirect method to prepare its statement of cash flows. Refer to the following information for 2017: The beginning balance in the Cash account was $2,900. Net cash provided by operating activities: $40,000 Net cash used for investing activities: $(25,500) Net cash provided by financing activities: $1,700 The statement of cash flows will show ________. A) ending cash of $16,200 B) total net cash flows of positive $65,500 C) total net cash flows of negative $16,200 D) ending cash of $19,100 11) Amber Corporation has provided the following information of its operating activities for the year: Merchandise Inventory, January 1 Merchandise Inventory, December 31 Purchases Selling and Administrative Expenses Sales Revenue $150,000 75,000 854,000 65,000 1,000,000 Required: Prepare Amber's income statement for the year ended December 31. Use the format provided below: Sales Revenue Cost of Goods Sold Beginning Inventory Purchases Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold Gross Profit Selling and Administrative Expenses Operating Income 12) Simons, Inc. sells plasticware. The following information summarizes Simons' operating activities for the year: Utilities Expense $ 65,000 Rent Expense 10,000 Sales Commissions Expense 32,500 Purchases of Merchandise 260,000 Merchandise Inventory on January 1 65,000 Merchandise Inventory on December 31 97,500 Sales Revenue 650,000 Prepare an income statement for Simons, Inc., a merchandiser, for the year ended December 31 using the format below: Sales Revenue Cost of Goods Sold: Beginning Inventory Purchases Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold Gross Profit Selling Expenses: Sales Commissions Expense Administrative Expenses: Rent Expense Utilities Expense Total Operating Expenses Operating Income 13) Anything for which managers want a separate measurement of cost is called a ________. A) responsibility center B) cost object C) profit object D) conversion cost 14) Define direct cost. Give an example 15) Define indirect cost. Give an example 16) Period costs are the ________. A) product costs that must be paid in the accounting period in which they are incurred B) costs that are incurred and expensed during the same accounting period C) costs related to production of products the company purchases and sells D) same as manufacturing overhead costs 17) Which of the following is an example of a period cost for a manufacturing company? A) advertising expense B) depreciation on factory equipment C) indirect materials D) property taxes for the factory 18) Which of the following is an example of direct labor cost in a factory? A) wages of assembly line personnel B) salary of vice president of production C) wages of factory security guard D) salary of production manager 19) Which of the following will be included in manufacturing overhead costs? A) indirect labor and indirect materials used B) salaries of salesmen C) direct materials and direct labor D) delivery costs to ship goods to customers 20) Kyanite Corporation, a manufacturer, reports costs for the year as follows: Direct Materials Used Wages to Line Workers Office Rent Indirect Materials Used $735,000 510,000 26,000 700,000 How much is the total period costs for Kyanite? A) $735,000 B) $510,000 C) $26,000 D) $700,000 21) Daryl Corporation reports costs for the year as follows: Direct Materials Used Wages to Line Workers Office Rent Indirect Materials Used $780,000 245,000 33,000 800,000 How much is the total product costs for the year? A) $800,000 B) $1,825,000 C) $1,858,000 D) $1,025,000 22) Which of the following is a product cost? A) sales commissions B) CEO's salary C) delivery van depreciation D) depreciation on production equipment 23) Which of the following correctly describes the accounting for indirect labor costs? A) Indirect labor costs are product costs and are expensed as incurred. B) Indirect labor costs are period costs and are expensed as incurred. C) Indirect labor costs are product costs and are expensed when the manufactured product is sold. D) Indirect labor costs are period costs and are expensed when the manufactured product is sold. 24) Which of the following correctly describes the accounting for factory depreciation? A) Factory depreciation is a product cost and is expensed as incurred. B) Factory depreciation is a period cost and is expensed as incurred. C) Factory depreciation is a product cost and is expensed when the manufactured product is sold. D) Factory depreciation is a period cost and is expensed when the manufactured product is sold. 25) Ferrell, Inc. used $213,000 of direct materials and incurred $111,000 of direct labor costs during the year. Indirect labor amounted to $8,100, while indirect materials used totaled $4,800. Other operating costs pertaining to the factory included utilities of $9,300; maintenance of $13,500; repairs of $5,400; depreciation of $23,700; and property taxes of $7,800. There was no beginning or ending finished goods inventory. The Work-in-Process Inventory account reflected a balance of $16,500 at the beginning of the period and $22,500 at the end of the period. Required: Prepare a schedule of cost of goods manufactured for Ferrell, Inc. using the format below. Cost of Goods Manufactured Beginning Work-in-Process Inventory Direct Materials Used Direct Labor Manufacturing Overhead: Indirect Labor Used Indirect Materials Utilities Maintenance Repairs Depreciation Property Taxes Total Manufacturing Overhead Total Manufacturing Costs Incurred during the Year Total Manufacturing Costs to Account For Ending Work-in-Process Inventory Cost of Goods Manufactured
Purchase answer to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

Hi,Please find the solutions attached. Calculations are on the attached excel sheetAll the bestP.S. If you have any questions, please do not hesitate to ask; if all is clear please review and rate my services

1) Which of the following is included in the entry to record the issuance of 14,000 shares of $7
par value common stock at $21 per share cash?
A) Cash is debited for $294,000.
B) Common Stock is debited for $98,000.
C) Common Stock is credited for $294,000.
D) Paid-In Capital in Excess of Par—Common is debited for $196,000.
2) The following information is from the December 31, 2017 balance sheet of Lawson
Corporation.
Preferred Stock, $100 par
Paid-In Capital in Excess of Par—Preferred
Common Stock, $1 par
Paid-In Capital in Excess of Par—Common
Retained Earnings
Total Stockholders' Equity

$560,000
43,000
190,000
510,000
191,500
$1,494,500

What was the average issue price of the common stock shares? (Round your answer to the
nearest cent.)
A) $1.88
B) $1.00
C) $2.68
D) $3.68
3) Moretown, Inc. had the following transactions in 2017, its first year of operations:
• Issued 31,000 shares of common stock. Stock has par value of $1.00 per share and was
issued at $20.00 per share.
• Earned net income of $70,000.
• Paid no dividends.
At the end of 2017, what is total stockholders' equity?
A) $31,000
B) $690,000
C) $620,000
D) $70,000
4) When 1,000 shares of $3 stated value common stock is issued at $18 per share, ________.
A) Common Stock — $3 Stated is credited for $18,000
B) the account titled Paid-In Capital in Excess of Stated is used to record the issue price of the
stock
C) the difference between the issue price and the stated value is credited to Paid-In Capital
in Excess of Stated
D) the accounting is exactly the same as the accounting for par value stock

5) On December 2, 2017, Ewell, Inc. purchases land. In payment for the land, Ewell, Inc. issues
6,000 shares of common stock with $6 par value. The land has been appraised at a market value
of $430,000. Which of the following is included in the journal entry to record this transaction?
A) debit Common Stock—$6 Par Value for $36,000 and debit Paid-In Capital in Excess of Par
—Common $394,000
B) credit Common Stock—$6 Par Value for $36,000 and credit Paid-In Capital in Excess of
Par—Common $394,000
C) credit Common Stock—$6 Par Value for $430,000
D) debit Cash $430,000
6) Osbourne, Inc. issued 60,000 shares of common stock in exchange for manufacturing
equipment. The equipment has a fair value of $1,420,000. The stock has a par value of $0.05 per
share. The journal entry to record this transaction includes a ________.
A) debit to Cash for $14,170,000
B) credit to Gain on Sale of Common Stock for $1,480,000
C) credit to Paid-In Capital in Excess of Par—Common for $1,417,000
D) credit to Common Stock—$0.05 Par Value for $1,420,000
7) Orange Office Supply Corporation completed the following stock issuance transactions:
Issued 5,000 shares of $4 stated value common stock for
Mar. 28 cash of $20 per share
Received merchandise inventory with a market value of
$46,000 in exchange for 2,000 shares of the $4 stated value
May 1 common stock.
Issued 450 shares of 5%, $20 par value preferred stock for
May 14 $50 per share
Prepare the journal entries to record these transactions. Explanations are not required.

Date
Mar. 28

May 1

Accounts and Explanations
Cash
Common Stock
Paid-in Capital in Excess of Stated Value-Common
Stock
Merchandise Inventory
Common Stock
Paid-in Capital in Excess of Stated Value-Common
Stock

Debit
100,000

Credit
20,000
80,000

46,000
8,000
38,000

May 14

Merchandise Inventory
Preferred Stock
Paid-in Capital in Excess of Par Value-Preferred Stock

22,500
9,000
13,500

8) Define treasury stock and provide two reasons why a corporation would purchase treasury
stock.
Treasury stock is a corporation’s own stock that it buys back after being issued. Treasury
stock is a contra equity account, which means that the purchase of treasury stock is
recorded as a debit.
Corporations may purchase treasury stock so as to avoid takeover by decreasing the
number of shares outstanding that has voting rights. Another reason could be that a
corporation might want to offer stock bonuses to its employees.

9) Treasury stock ________.
A) decreases the number of shares issued
B) increases the number of shares issued
C) increases the number of shares outstanding
D) decreases the number of shares outstanding
10) Assume the following information for Petra Sales, Inc.:





Common Stock, $1.00 par, 232,000 shares issued, 186,000 shares outstanding
Paid-In Capital in Excess of Par—Common: $1,770,000
Retained Earnings: $2,450,000
Treasury Stock: 26,000 shares purchased at $12 per share

If Petra Sales purchases an additional 13,000 shares of treasury stock at $18 per share, what
number of shares will be shown as issued and outstanding?
A) 18 issued; 186,000 outstanding
B) 219,000 issued; 186,000 outstanding
C) 232,000 issued; 173,000 outstanding
D) 232,000 issued; 186,000 outstanding
11) Supermart, Inc. completed the following treasury stock transactions in 2016:
Mar. 3 Purchased 1,800 shares of the company's $ 3 par value common stock as treasury stock,
paying cash of $ 10 per share.
Mar. 17 Sold 400 shares of the treasury stock for cash of $ 12 per share.

Mar. 25 Sold 600 shares of the treasury stock for cash of $ 7 per share.
(Assume the balance in Paid-In Capital from Treasury Stock Transactions on March 24 is $
1,200.)
Journalize these transactions. Explanations are not required.
How will Supermart, Inc. report treasury stock on its balance sheet as of December 31, 2016?

Date
Mar. 3

Mar.17

Mar. 25

Accounts and Explanations
Treasury Stock - Common Stock
Cash

Debit
18,000

Cash
Treasury Stock - Common
Paid-in Capital from Treasury
Stock

4,800

Cash
Paid-in Capital from Treasury Stock
Retained Earnings
Treasury Stock- Common

4,200
1,200
600

Credit
18,000

4,000
800

6,000

Supermart, Inc will report Treasury Stock under Retained Earnings as a reduction to
stockholders' equity.

12) On the ________, cash dividends become a liability of a corporation.
A) declaration date
B) date of record
C) last day of the fiscal year
D) payment date
13) The entry to record the payment of a previously declared dividend of $0.25 per share on
18,500 shares of common stock includes a ________.
A) debit to Cash Dividends for $4,625
B) debit to Cash $4,625
C) credit to Cash Dividends for $4,625
D) debit to ...


Anonymous
Great! Studypool always delivers quality work.

Studypool
4.7
Indeed
4.5
Sitejabber
4.4

Related Tags