208.Wheeler Company reports the following amounts for 2011.
Net income $150,000
Average stockholders’ equity1,000,000
Preferred dividends42,000
Par value preferred stock200,000
The 2011 rate of return on common stockholders’ equity is
a.18.8%
b.13.5%
c.15.0%
d.10.8%
a209.A stockholders’ equity statement shows
a.the names of each stockholder.
b.how profits are distributed to the various classes of stockholders.
c.the number of shares owned by each of the stockholders.
d.the changes in each stockholders’ equity account and in total stockholders’ equity during the period.
a210.Book value per share is
a.the equity a common stockholder has in the net assets of the corporation from owning one share of stock.
b.the equity a common stockholder has in the total assets of the corporation from owning one share of stock.
c.always equal to the market value of the stock.
d.computed only for preferred stockholders.
a
211.Book value per share is computed by dividing total
a.paid-in capital by the number of common shares outstanding.
b.paid-in capital by the number of common shares issued.
c.stockholders’ equity by the number of common shares outstanding.
d.stockholders’ equity by the number of common shares issued.
212.Barr, Inc. reports $4,000,000 of common stock, and $6,000,000 of additional paid-in capital on its balance sheet. The number of common shares issued and outstanding is 500,000 shares. The book value per share is
a.$20.
b.$12.
c.$8.
d.not determinable.
213. Which of the following is an
incorrect
statement about a corporation?
a.A corporation is an entity separate and distinct from its owners.
b.Creditors ordinarily have recourse only to corporate assets in satisfaction of their claims.
c.A corporation may be formed in writing, orally, or implied.
d.A corporation is subject to numerous state and federal regulations.
214.Capital stock to which the charter has assigned a value per share is called
a.par value stock.
b.no-par value stock.
c.stated value stock.
d.assigned value stock.
215. Legal capital per share cannot be equal to the
a.par value per share of par value stock.
b.total proceeds from the sale of par value stock above par value.
c.stated value per share of no-par value stock.
d.total proceeds from the sale of no-par value stock.
216. When common stock is issued for services or non-cash assets, cost should be
a.only the fair market value of the consideration given up.
b.only the fair market value of the consideration received.
c.the book value of the common stock issued.
d.either the fair market value of the consideration given up or the consideration received, whichever is more clearly evident.
217.When the selling price of treasury stock is greater than its cost, the company credits the difference to
a.Gain on Sale of Treasury Stock.
b.Paid-in Capital from Treasury Stock.
c.Paid-in Capital in Excess of Par Value.
d.Treasury Stock.