41.Blue Waters Sailing had a retained earnings account balance on January 1, 2007 of $120,000. During 2007 the firm had net income of $72,000 and paid a $36,000 cash dividend. What is the December 31, 2007 retained earnings balance?
a.$122,000
b.$156,000
c.$196,000
d.$212,000
e.$228,000
42.A company sold $100,000 of common stock at par value. This transaction should be entered into the accounting system as
Equity Assets
a.Yes Yes
b.Yes No
c.No Yes
d.No No
43.Soft Rock, Inc. sold 4,000 shares of its treasury stock to a new investor. Which of the following increased?
Authorized Stock Issued Stock
a.Yes Yes
b.Yes No
c.No Yes
d.No No
44.Sam and Dave each own common stock of the Sea Green Racing Company. If Sam sells his stock directly to Dave, which of the following statements is true?
a.Sea Green's contributed capital increases
b.Sea Green's contributed capital decreases
c.Sea Green's contributed capital remains the same
d.Sea Green's cash account increases
45.Which of the following sometimes involves an adjustment to the par value of the stock involved?
a.stock dividend
b.cash dividend
c.stock split
d.purchase of stock as an investment
46.If a company has 500,000 shares of common stock authorized, 300,000 shares issued, and 50,000 shares held as treasury stock, how many shares are outstanding?
a.500,000
b.350,000
c.300,000
d.250,000
47.Stacey Company has the following account balances in its stockholders' equity:
Preferred Stock$8,000
Common Stock10,000
Paid-in Capital in excess of par value16,000
Retained earnings25,000
What is the amount of the company's contributed capital?
a.$59,000
b.$34,000
c.$18,000
d.$16,000
48.Dividends on common stock are
a.recorded as expense when paid
b.recorded as expense when declared
c.recorded as expense at year end
d.recorded as a reduction of retained earnings
49.During 2008 Adelphi Company had reported net income but paid no dividends. Comparing the balance sheet at the end of 2008 with the one at the beginning of the year, which of the following would most likely be true?
a.current assets would be higher
b.fixed assets would be higher
c.stockholders' equity would be higher
d.both assets and stockholders' equity would be higher
e.total liabilities would be lower
50.The Sleek Guitar Company declared a 10% stock dividend (10,000 shares to be distributed when the par value was $10 per share, and the market value was $30 per share). When this transaction is entered into the accounting system, how will it affect total stockholders' equity?
a.no effect
b.$100,000 increase
c.$100,000 decrease
d.$300,000 increase
e.$300,000 decrease