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Acct 2301.02 Principles Of Financial Accounting

5 Questions
Acct 2301.02 Principles Of Financial Accounting

As I've indicated before, you will be responsible for reading Chapter 11 and will be tested, to a limited extent, about the chapter in our course's final exam. This quiz consists of the 5 questions taken from Chapter 11 that will appear on the final.

Questions and Answers
  • 1. 
    Stock is attractive to investors because stockholders are not liable for the corporation's actions and debts and because stock is easily transferred.
    • A. 

      True

    • B. 

      False

  • 2. 
    Authorized stock is the total number of shares outstanding.
    • A. 

      True

    • B. 

      False

  • 3. 
    When all of the authorized shares have the same rights and characteristics, the stock is called:
    • A. 

      Preferred stock

    • B. 

      Common stock

    • C. 

      Par value stock

    • D. 

      Stated value stock

    • E. 

      No-par value stock

  • 4. 
    Owners of preferred stock often do not have:
    • A. 

      Ownership rights to the assets of the corporation

    • B. 

      Voting rights

    • C. 

      Preference to dividends

    • D. 

      The rights to sell their stock on the open market

    • E. 

      Preference to assets at liquidation

  • 5. 
    A company had a beginning balance in Retained Earnings of $43,000. It had net income of $6,000 and paid cash dividends of $5,625 in the current period. The ending balance in Retained Earnings equals:
    • A. 

      $108,625

    • B. 

      $(12,625)

    • C. 

      $11,375

    • D. 

      $43,375

    • E. 

      $(11,375)