ch 11 hw

• Market value per share is:The price at which a stock is bought and sold.
• The board of directors of a corporation:Is responsible for overseeing corporate activities.
• The number of shares that a corporation’s charter allows it to sell is referred to as:Authorized stock.
• When all authorized shares of a corporation’s stock have the same rights and characteristics, the stock is called:Common stock.
• Stated value stock is:No-par stock that has an assigned “stated” value per share.
• Prior period adjustments are reported in theStatement of retained earnings.:
• The amount of income earned per share of outstanding common stock is known asEarnings per share.:
• The amount of annual cash dividends distributed to common shareholders relative to the common stock's market value is the:Dividend yield.
• The dividend yield is computed by dividing:Annual cash dividends per share by the market value (price) per share.
• The date for identifying the stockholders to receive dividends is called the:Date of record.
• A corporation's distribution of additional shares of its own stock to its stockholders without any payment in return is called a:Stock dividend.
• A stock dividend is recorded with a transfer from:Retained earnings to contributed capital.
• A dividend preference for preferred stock means that:Preferred stockholders are paid their dividends before any dividends are paid to common stockholders.
• Stock shares that are reacquired by the issuing corporation are called:Treasury stock.
• Treasury stock is classified as:A contra equity account.
• A common contractual restriction is a loan agreement that restricts paying dividends beyond a specified amount of retained earnings.
• Dividend yield is a comparison of a company’s earnings per share and its market value per share. false
• Stocks that pay little or no cash dividends but are attractive to investors because of expected stock price increases are known as:Growth stocks.
• Aviation Incorporated has 135,000 shares authorized, 125,000 shares issued and no treasury stock. Determine the number of shares outstanding: 125,000.
• A premium on stock:Occurs when a corporation sells its stock for more than par or stated value.
• A corporation with $10 par common stock issues a large stock dividend. The capitalization of retained earnings is equal to:The par value of the shares to be distributed.
• Hutter Corporation declared a $0.50 per share cash dividend on its common shares. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 shares of common stock outstanding. The journal entry to record the dividend payment is:Debit Common Dividend Payable $4,000; credit Cash $4,000.
• • Directors can use stock dividends to keep the market price of the stock affordable.
• Stock dividends provide evidence of management's confidence that the company is doing well.
• Stock dividends do not reduce assets or equity.
• Stock dividends transfer a portion of equity from retained earnings to contributed capital.
• Eastline Corporation had 15,000 shares of $10 par value common stock outstanding when the board of directors declared a stock dividend of 6,000 shares. At the time of the stock dividend, the market value per share was $22. The entry to record this dividend is: Debit Retained Earnings $60,000; credit Common Stock Dividend Distributable $60,000.
• Fetzer Company declared a $0.55 per share cash dividend. The company has 200,000 shares authorized, 190,000 shares issued, and 8,000 shares in treasury stock. The journal entry to record the dividend declaration is: Debit Retained Earnings $100,100; credit Common Dividend Payable $100,100.