31) Following is the shareholders' equity section of the balance sheet of Easypix Corporation:
Share capital:
Preferred shares, 80,000 authorized, 50,000 issued$ 5,000,000
Common shares, 3,000,000 authorized, 1,500,000 shares issued 7,500,000
Total share capital$12,500,000
Retained earnings 4,800,000
Total shareholders' equity$17,300,000
The entry to record the sale of 8,000 repurchased shares that cost $12.50 per share for $13 per share includes a:
A) debit to Retained Earnings for $104,000
B) credit to Contributed Surplus - Share Repurchase for $4,000
C) debit to Common Shares for $96,000
D) credit to Common shares for $104,000
32) Following is the shareholders' equity section of the balance sheet of Easypix Corporation:
Share capital:
Preferred shares, 80,000 authorized, 50,000 issued$ 5,000,000
Common shares, 3,000,000 authorized, 1,500,000 shares issued 7,500,000
Total share capital$12,500,000
Retained earnings 4,800,000
Total shareholders' equity$17,300,000
Assuming Easypix repurchases 15,000 shares of its common shares at $12.50 per share, the total shareholders' equity is:
A) increased by $75,000
B) decreased by $112,500
C) the same as before the repurchase of the shares
D) reduced by $187,500
33) Following is the shareholders' equity section of the balance sheet of Easypix Corporation:
Share capital:
Preferred shares, 80,000 authorized, 50,000 issued$ 5,000,000
Common shares, 3,000,000 authorized, 1,500,000 shares issued 7,500,000
Total share capital$12,500,000
Retained earnings 4,800,000
Total shareholders' equity$17,300,000
Assuming Easypix purchases 15,000 shares of its common shares at $12.50 per share, the number of common shares issued and outstanding is:
A) 2,985,000 and 1,485,000
B) 3,000,000 and 2,985,000
C) 3,000,000 and 1,485,000
D) 1,500,000 and 1,485,000
34) The repurchase of shares will cause:
A) outstanding shares to exceed issued shares
B) issued shares to exceed outstanding shares
C) outstanding shares to equal issued shares
D) issued shares to exceed authorized shares
35) A dividend is declared by the:
A) chief executive officer
B) board of directors
C) shareholders of record
D) president of the company
36) When a cash dividend is declared:
A) the Cash account is debited.
B) the Cash account is credited.
C) the Retained Earnings account is debited.
D) the Retained Earnings account is credited.
37) A dividend becomes a legal liability of the corporation on the:
A) date of payment
B) date of declaration
C) date of record
D) date of distribution
38) All of the following require payments by the corporation to its shareholders
except:
A) share repurchases
B) shares retirements
C) cash dividends
D) stock splits
39) Glow Corporation has 50,000 shares of preferred shares outstanding, with annual dividends paid at the rate of $1.50 per share. Glow also has 100,000 shares of common shares outstanding. If Glow declares a $250,000 dividend in 2007, each outstanding share of common shares would receive:
A) $1.17
B) $1.75
C) $1.50
D) $2.50
40) The payment of a cash dividend previously recorded:
A) reduces shareholders' equity and reduces assets
B) increases liabilities and increases assets
C) reduces liabilities and reduces assets
D) increases shareholders' equity and reduces liabilities