Question : 64. When a company reports both diluted earnings per share and : 1229417

Accounting

64. When a company reports both diluted earnings per share and basic earnings per share:
A. Basic EPS would be greater than fully diluted EPS.
B. Basic EPS would be less than fully diluted EPS.
C. Basic EPS may be either greater or less than fully diluted EPS.
D. Both should never be shown – only one would be reported.

65. A liquidating dividend:
A. Occurs when a corporation distributes shares of its own stock as a dividend, rather than cash.
B. Occurs whenever a corporation distributes non-cash assets as a dividend to its stockholders.
C. Represents a distribution of a corporation’s profits to the stockholders.
D. Represents a return of invested capital to a corporation’s owners, the stockholders.

66. Dividends are first recorded and retained earnings are reduced on:
A. The ex-dividend date.
B. The date of record.
C. The date of declaration.
D. The date of payment.

67. As a result of a 5% stock dividend:
A. Total stockholders’ equity decreases by 5%.
B. The par value per share decreases by 5%.
C. The number of shares owned by each stockholder increases by 5%, but total stockholders’ equity does not change.
D. Both the number of shares outstanding and the total stockholders’ equity increase by 5%.

68. If a company presents both the basic and diluted earnings per share, the price/earnings ratio is based on:
A. The basic figure.
B. The diluted figure.
C. The average of the basic and diluted figures.
D. A combination of the basic and diluted figures.

69. A large stock dividend and a stock split are similar in that they both cause a:
A. Reduction in total stockholders’ equity.
B. Reduction in retained earnings.
C. Reduction in the par value per share.
D. Reduction in the market price per share.

70. Supervox Corporation declared a 3-for-2 common stock split, but this transaction was erroneously recorded as a 50% common stock dividend. As a result:
A. Retained earnings is understated.
B. The total dollar amount of stockholders’ equity is overstated.
C. The corporate records do not show the correct number of shares of common stock outstanding.
D. The common stock account is understated.

71. Declaration and distribution of a stock dividend cause each of the following effects except:
A. An increase in the number of shares of stock outstanding.
B. A decrease in retained earnings.
C. A decrease in total assets of the issuing corporation.
D. An increase in legal capital of the issuing corporation.

72. A 2-for-1 stock split:
A. Is accounted for in the same way as a 100% stock dividend.
B. Increases the number of outstanding shares of common stock, but par value per share remains the same as before the split.
C. Is recorded by transferring the par value of additional shares from retained earnings to the common stock account.
D. Should logically cause the market price per share to drop by approximately 50%.

73. If a material accounting error was made in a prior year, that error:
A. Should be reflected on the current year’s income statement.
B. Should be reflected, net of taxes, on the retained earnings statement.
C. Should be reflected as a change in accounting principle.
D. Should be considered as an extraordinary item, and shown, net of taxes, on the income statement.

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July 1, 2023

Distinguishing Inductive and Deductive Reasoning

Required Resources
Read/review the following resources for this activity:

· Textbook: Chapter 8, 9, 17 (Introduction)

· Lesson

· Minimum of 1 scholarly source (in addition to the textbook)

Click on the following tabs to review the concepts that will be addressed in this activity:

A valid structure is the way in which an argument is put together that assures it will pass the test of logical strength.

Deductive: In deductive arguments, the speaker asserts that her premises are true and, therefore, her conclusion must be accepted. Remember that in a deductive argument, logical strength does not depend on the literal truth of the premises. When we test for logical strength, we assume the premises are true. Once we determine that the argument is logically valid, we can then look at the actual – not presumed – truth of the premises.

Inductive: In inductive arguments, the speaker presents evidence that she claims support the probable truth of her conclusion – that her conclusion is the most likely true – and so you should accept it.

The Basic Structure of Deductive and Inductive Arguments
Argument examples:

Deductive Argument Example: “Tightening laws restricting the use and possession of firearms does not protect average law-abiding citizens; it only puts them at greater risk. Enforcing licensing restrictions, trigger locks, and waiting periods makes it more difficult for law-abiding citizens to defend themselves, and, as a result, encourages criminal activity. Only criminals benefit when ordinary citizens are deprived of their right to own a firearm and protect themselves, their homes, and their families" (Lott, 2000, p. 169)

Lott, J., (2000). More guns, less crime: Understanding crime and gun-control laws. University of Chicago Press.

The argument boils down to this:

· Laws that are obeyed by ordinary citizens and not obeyed by criminals are laws that put ordinary citizens at risk.

· Tight gun laws are laws that are obeyed only by ordinary citizens.

· Tight gun laws put ordinary citizens at risk.

However, the argument itself is composed of three intertwined syllogisms:

Only ordinary citizens are persons who respect tight gun laws.
Criminal persons are not ordinary citizens.
Therefore, criminals do not respect tight gun laws.

Tight gun laws restrict only ordinary citizens.
No criminal is an ordinary citizen.
No criminal is restricted by tight gun laws.

Laws that disfavor the good are laws that favor the bad.
Tight gun laws favor the bad.
Therefore, tight gun laws disfavor the good.

Notice that you cannot remove any of the “legs” and maintain the claim. Notice, also, that the reasons are closely connected and depend on or follow from each other. Notice, also, that the first premise (called the major premise) must be accepted as true, or the entire argument fails.

Inductive Argument: The United States is too dependent upon foreign oil. According to the U.S. Department of Energy, we rely on imported foreign oil for about 45% of our needs. Of the imported oil, most comes from Canada, but 22% comes from countries in the Middle East. Undeniably, this dependence shapes our foreign policy. We have vast oil reserves that could make us energy independent. Development of these resources would produce much-needed jobs, many of them in areas of the country suffering most from the recession. We should be developing an energy policy that makes us energy independent.

· Reason: We import 45% of our oil.

· Reason: Middle East oil imports shape our foreign policy.

· Reason: Our vast oil reserves could make us energy independent.

· Reason: Development of oil reserves could produce much needed jobs.

· Conclusion: For any or all of the above, independent reasons, we should become energy independent.

Notice that any one of these reasons, standing alone, could support the conclusions; they are not logically related to one another as they would be in a syllogism.

Initial Post Instructions
For the initial post, address the following:

· Find and post examples of deductive and inductive arguments. Do NOT use an argument example which clearly indicates it is an example of an inductive/deductive argument.

· For each example, evaluate its logical strength, using the concepts and ideas presented in the textbook readings, the lesson, and any other source you find that helps you to evaluate the validity (deductive) or strength (inductive) of the argument. You can use examples from the text, or you can find examples elsewhere.

oEditorials and opinion columns are a good source, as are letters to the editor. Blogs will also often be based on arguments.

oUse mapping and evaluative techniques to make sure it is an argument.

· Is it inductive or deductive? Explain why.

· Does it pass the tests of validity and strength? Explain.