corporation

• When shares with par value are sold, the excess of the proceeds over the par value is credited to

  Share premium
• When shares without par value are sold, the excess proceeds over stated value shall be credited to

  Share premium
• If shares are issued for a noncash consideration, the shares issued shall be measured by

  Fair value of the noncash consideration
• If shares are issued to extinguish a financial liability, what is the initial measurement of the shares issues?

  Fair value of the shares
• When shares are issued in payment for services, what is the least appropriate basis for recording the transaction?

  Par value of the shares
• What is the meaning of net assets of a corporation?

  Shareholders' equity
• The two primary account classifications within shareholders' equity are

  Contributed capital and retained earnings
• Details of each class of share capital should be reported

  On the face of the statement of financial position or in disclosure notes.
• The corporate charter is known as

  Articles of incorporation
• Characteristics if the corporate form that have led to the growth of this form of business ownership include all of the following except

  Low government regulation
• Three (3) of the following are attributes of a corporation. Which is the exception?

  Created by agreement of the incorporators.
• the advantage of forming a corporation?

  The subservience of minority stockholders to the wishes of the majority subject only to equitable restraints.
• the disadvantage of forming a corporation.

  The subservience of minority stockholders to the wishes of the majority subject only to equitable restraints.
• Right of the corporation to continue as a juridical entity for the term stated in the articles of incorporation despite the death of any stockholders.

  Right of sucession
• Under this test, a corporation is a national of the country pursuant to whose laws it is incorporated

  Incorporation test
• The nationality of the corporation is determined by the place of the controlling stockholders. This test is

  Control test
• The nationality of a corporation is determined by the law of its domicile or place of principal business. This test is known as the

  Management theory
• A corporate doctrine which holds the stockholders are not personally liable for corporate debts

  Separate legal entity
• The right of a corporation to exist as juridical person during its term as stated in its Articles of Incorporation despite the death of any of its stockholders is

  Right of succession
• Right of the corporation to continue as a juridical entity for the period stated in the articles of incorporation despite the death of any stockholder

  Right of succession
• similarities between a partnership and a corporation. Which is the exception?

  The individuals composing both have little voice in the conduct of the business
• Corporations organized by private persons performing public function and for profit to private persons are

  Quasi-public corporation
• Corporations governed by special laws, aside from the requirements specified under the corporation law, in order that their articles of incorporation may be approved or accepted, must present before the Securities and Exchange Commission


  A favorable recommendation of the appropriate government agency to the effect that such articles or amendment is in accordance with law.
• These are the persons who sign the Articles of Incorporation.

  Incorporators
• Those who undertake to form a corporation and to procure for it the rights, instrumentalities and capital by which it is to carry out the purposes set forth in its charter, and to establish it as fully able to do business, are called

  Promoters
• A common type of non-cumulative preferred share is

  Guaranteed type
• When the preferred shares are issued by a corporation with a fixed annual dividend on the face thereof, the effect is

  The stockholder is a plain investor who may benefit or suffer with the financial success or failure of the corporation.
• When preferred shares are issued by a corporation with a fixed annual interest on the face thereof, the effect is the


  Stockholder is a plain investor who may rise or fall with the financial success or failure of the corporation.
• They are issued to those who helped in incorporating the company or for services rendered in launching the welfare of the company.

  Promotion stocks
• The following are advantages of par value shares of stock, except one

  Liability of subscribers for unpaid subscription.
• The following are advantages of no-par value share of stock. Which is the exception

  Industrial companies
• The following are advantages of no-par value share of stock. Which is the exception

  It allows the issue of stocks in exchange of property
• Three of the following are widely known advantages of no par value shares of stock. Which is the exception.

  It legalizes issues of stock for property.
• The Corporation Code provides three methods of fixing the issued value of no-par value shares. Which of the following is the exception.

  By the stockholders representing at least 2/3 of the outstanding capital stock at a meeting duly called for the purpose
• This is the effect of issuance of no-par value shares to the shareholders.

  The holder of such shares shall not be liable to the corporation or to its creditors in respect thereto.
• 1st Statement - When par value shares are issued above par, the premium or excess is to be considered as part of the legal capital. 2nd Statement - Shares issued without par value shall be deemed fully paid and non-assessable and the holder of such shares shall not be liable to the corporation or its creditors in respect thereto. (Sec. 6)

  1st Statement - False, 2nd Statement - True
• 1st statement: When par value shares are issued above par, the premium or excess is to be considered as part of the legal capital. 2nd statement: Shares issues without par value shall be deemed fully paid and non-assessable and the holder of such shares shall not be liable to the corporation or its creditors in respect thereto.


  Both statements are true.
• This is the amount paid in or secured to be paid by stockholders upon which it is to conduct its operations and is the property of the corporation itself.

  Capital stock
• This is the interest or right which the owner has in the management of the corporation, in its surplus profits, and upon dissolution, in all of its assets remaining after the payment of the debt

  Capital
• The interest or right of the owner in the corporation's profits or in the net assets of the corporation on dissolution is

  Share of stock