Question :
91. When Bayou Corporation was formed January 1, 20xx, the corporate : 1239271
91. When Bayou Corporation was formed on January 1, 20xx, the corporate charter provided for 100,000 share of $10 par value common stock. The following transaction was among those engaged in by the corporation during its first month of operation: The corporation issued 9,000 shares of stock at a price of $23 per share.
The entry to record the above transaction would include a
A. debit to Cash for $90,000
B. credit to Common Stock for $207,000
C. credit to Paid in Capital in Excess of Par for $117,000
D. debit to Common Stock for $90,000
92. On January 1, 20xx, Swenson Corporation had 40,000 shares of $10 par value common stock issued and outstanding. All 40,000 shares had been issued in a prior period at $20.00 per share. On February 1, 20xx, Swenson purchased 4,000 shares of treasury stock for $24 per share and later sold the treasury shares for $21 per share on March 1, 20xx.
The journal entry to record the purchase of the treasury shares on February 1, 20xx, would include a
A. credit to Treasury Stock for $96,000.
B. debit to Treasury Stock for $96,000.
C. debit to a loss account for $120,000
D. credit to a gain account for $120,000.
93. The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 60,000 shares were originally issued and 10,000 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2 per share dividend is declared?
A. $ 60,000
B. $ 20,000
C. $120,000
D. $100,000
94. The charter of a corporation provides for the issuance of 100,000 shares of common stock. Assume that 45,000 shares were originally issued and 5,000 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2 per share dividend is declared?
A. $80,000
B. $10,000
C. $90,000
D. $100,000
95. The date on which a cash dividend becomes a binding legal obligation is on the
A. declaration date.
B. date of record.
C. payment date.
D. last day of the fiscal year.
96. The cumulative effect of the declaration and payment of a cash dividend on a company’s financial statements is to
A. decrease total liabilities and stockholders’ equity.
B. increase total expenses and total liabilities.
C. increase total assets and stockholders’ equity.
D. decrease total assets and stockholders’ equity.
97. Which of the following is the appropriate general journal entry to record the declaration of a cash dividends?
A. Retained earnings
Cash
B. Cash Dividends payable
Cash
C. Paid-in capital
Cash Dividends payable
D. Cash Dividends
Cash Dividends Payable
98. Miriah Inc. has 10,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014. What is the annual dividend on the preferred stock?
A. $50 per share
B. $50,000 in total
C. $10,000 in total
D. $0.50 per share
99. Which of the following is not a prerequisite to paying a cash dividend?
A. formal action by the board of directors
B. market value in excess of par value per share
C. sufficient cash
D. sufficient retained earnings
100. The liability for a dividend is recorded on which of the following dates?
A. the date of record
B. the date of payment
C. the last day of the fiscal year
D. the date of declaration
