Question : 71. Slickers, Inc. had the following capital structure during 2010:Preferred stock, : 1228446

Accounting

71. Slickers, Inc. had the following capital structure during 2010:
Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009.
Common stock, $100 par value, 2,000 shares issued and outstanding.
The total dividends declared and paid during 2010 totaled $25,000. How much of the dividend is paid to the preferred stockholders during 2010 assuming the preferred stock is noncumulative?
A. $3,500
B. $7,000
C. $10,500
D. $14,500

72. Slickers, Inc. had the following capital structure during 2010:
Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009.
Common stock, $100 par value, 2,000 shares issued and outstanding.
The total dividends declared and paid during 2010 totaled $25,000. How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative?
A. $3,500
B. $7,000
C. $21,500
D. $14,500

73. Slickers, Inc. had the following capital structure during 2010:
Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009.
Common stock, $100 par value, 2,000 shares issued and outstanding.
The total dividends declared and paid during 2010 totaled $25,000. How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is cumulative?
A. $3,500
B. $7,000
C. $22,500
D. $14,500

74. Which of the following is a correct statement about cumulative and noncumulative preferred stock?
A. They both receive dividends in arrears.
B. Cumulative stock’s undeclared dividends accumulate each year until paid, while noncumulative stock’s right to receive dividends is forfeited in any year that dividends are not declared.
C. Cumulative preferred stock is guaranteed to receive their dividends.
D. Cumulative preferred stock’s right to receive dividends is forfeited in any year that dividends are not declared. However, noncumulative stock’s undeclared dividends accumulate each year until paid.

75. Cornhusker Corporation plans to raise $10 million cash on January 1, 2010, by issuing either bonds payable (8% interest rate) or cumulative preferred stock (8% dividend rate). How would the annual interest amount on the bonds or annual preferred dividend amount (if paid) affect the net income for the year ended December 31, 2010?
A. Net income would be reduced by the annual interest on the bonds and by the annual preferred stock dividends.
B. Net income would be reduced by the annual interest on the bonds but not by the annual preferred stock dividends.
C. Net income would not be reduced by either the annual interest on the bonds or the annual preferred stock dividends.
D. Net income would be reduced by the annual preferred dividends but not by the annual interest on the bonds.

76. CBA Company reported total stockholders’ equity of $85,000 on its balance sheet dated December 31, 2010. During the year ended December 31, 2011, CBA reported net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional common stock for $20,000. What is total stockholders’ equity as of December 31, 2011?
A. $117,000
B. $113,000
C. $109,000
D. $101,000

77. A company reported total stockholders’ equity of $170,000 on its balance sheet dated December 31, 2010. During the year ended December 31, 2011, the company reported net income of $20,000, declared and paid a cash dividend of $4,000, declared and distributed a 10% stock dividend with a $5,000 total market value, and issued additional common stock for $40,000. What is total stockholders’ equity as of December 31, 2011?
A. $234,000
B. $226,000
C. $231,000
D. $221,000

78. A company reported total stockholders’ equity of $340,000 on its balance sheet dated December 31, 2010. During the year ended December 31, 2011, the company reported net income of $40,000, declared and paid a cash dividend of $8,000, declared and distributed a 10% stock dividend with a $10,000 total market value, purchased treasury stock costing $12,000, and issued additional common stock for $60,000. What is total stockholders’ equity as of December 31, 2011?
A. $432,000
B. $410,000
C. $444,000
D. $420,000

79. A company reported total stockholders’ equity of $540,000 on its balance sheet dated December 31, 2010. During the year ended December 31, 2011, the company reported net income of $60,000, declared and paid a cash dividend of $18,000, declared and distributed a 10% stock dividend with a $15,000 total market value, sold treasury stock costing $12,000 for $15,000, and issued additional common stock for $70,000. What is total stockholders’ equity as of December 31, 2011?
A. $650,000
B. $670,000
C. $667,000
D. $655,000

80. Wendell Company provided the following pertaining to its recent year of operation:
? Common stock with a $10,000 par value was sold for $50,000 cash.
? Cash dividends totaling $20,000 were declared, of which $15,000 were paid.
? Net income was $70,000.
? A 5% stock dividend resulted in a common stock distribution, which had a $5,000 par value and a $23,000 market value.
? Treasury stock costing $9,000 was sold for $7,000.
How much did Wendell’s total stockholders’ equity increase during the recent year of operation?
A. $107,000
B. $84,000
C. $80,000
D. $112,000

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121.In the context of the 1997 Asian crisis, how did the International Monetary Fund's “one-size-fits-all” approach to macroeconomic policy affect South Korea?

A. It led to a decrease in the interest rates of short-term loans.

B. It made it difficult for companies to service their excessive short-term debt obligations.

C. It decreased the probability of widespread corporate defaults.

D. South Korea failed to recover from its financial crises.

E. South Korea was forced to increase restrictions on foreign direct investment.

122._____ arises when people behave recklessly because they know they will be saved if things go wrong.

A. Systemic risk

B. Moral hazard

C. Ethical dilemma

D. Tragedy of the commons

E. Risk compensation

123.Jade, a working professional, began driving rashly ever since she got her car insured against damage. She believed that the insurance claim would cover her in case of any accidents. Jade’s behavior is due to a situation known as _____.

A. cognitive dissonance

B. conflict of interest

C. systemic risk

D. moral hazard

E. tragedy of the commons

124.The International Monetary Fund been criticized for:

A. its lack of “one-size-fits-all” approach to macroeconomic policy.

B. encouraging moral hazard among banks.

C. its lack of power and authority.

D. using external experts to gain knowledge about a country.

E. keeping its operations open to outside scrutiny.

125.According to the critics of the International Monetary Fund (IMF), how should the problem of moral hazard exhibited by banks be resolved?

A. The IMF should use a “one-size-fits-all” approach to macroeconomic policy.

B. The IMF should establish a mechanism for accountability.

C. The IMF should free all banks from the obligation of financial reporting.

D. The banks should be forced to pay the price for their rash lending policies.

E. The IMF should bail out the banks whose loans gave rise to financial crises.

126.According to the noted economist Jeffrey Sachs, the International Monetary Fund should:

A. not be accountable to anyone as it is a powerful institution.

B. bail out the banks that have rash lending policies.

C. have a “one-size-fits-all” approach to macroeconomic policy.

D. keep its operations open to greater outside scrutiny.

E. lend only to countries with safe credit ratings.

127.The International Monetary Fund programs have been counterproductive, or only had limited success in _____.

A. Turkey

B. Iceland

C. Greece

D. Ireland

E. Latvia

128.In response to the global financial crisis of 2008–2009, the International Monetary Fund began to:

A. exercise tight controls on fiscal policy of the borrowing countries.

B. encourage activities that resulted in high inflation rates.

C. display inflexibility in policy responses.

D. urge countries to adopt policies that included fiscal stimulus and monetary easing.

E. adopt a “one-size-fits-all” approach to macroeconomic policy.

129.Which of the following observations about the International Monetary Fund (IMF) is true?

A. The IMF can force countries to adopt the policies required to correct economic mismanagement.

B. Internal political problems can affect a government's commitment to taking corrective action in return for an IMF loan.

C. In recent years, the IMF has begun to make its policies more tight and inflexible.

D. In response to the global financial crisis of 2008–2009, the IMF began to adopt a “one-size-fits-all” approach to macroeconomic policy.

E. In recent years, the IMF has begun to urge countries to oppose fiscal stimulus and monetary easing.

130.Which of the following poses a problem for international businesses in the long run?

A. Using exchange rate instruments like the forward market and swaps

B. Volatility of global exchange rate regime

C. Anti-inflationary monetary policies

D. Maintaining strategic flexibility by dispersing production to different locations

E. A policy of reduction in government spending