Accounting Chapter 9 Word Scramble
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| Question | Answer |
| Lurvey Company is authorized to issue 50,000 shares of $25 par common stock. On May 30, 2010, Lurvey issued 20,000 shares at $45 per share. Luvey's journal entry to record these facts should include a: | credit to Common Stock for $500,000 (20,000 shares x $25 = $500,00) |
| Syracuse Corporation purchased treasury stock in 2010 at a price of $15 per share and resold the treasury stock in 2011 at a price of $35 per share. What amount should Syracuse report on its income statement for 2011? | $0 [No gain or loss (for the income statement) on treasury stock transactions] |
| The stockholders' equity section of a corporation's balance sheet reports: | Discount on Bonds Payable: NO; Treasury Stock: YES |
| The purchase of this stock decreases total assets and decreases total stockholders' equity. | Treasury Stock |
| When does a cash dividend become a legal liability? | On date of declaration |
| When do dividends increase stockholders' equity? | Never |
| True or False. Stock dividends have no effect on total stockholders' equity. | True |
| True or False. Stock dividends increase the corporation's total liabilities. | False |
| True or False. Stock dividends reduce the total assets of the company. | False |
| True or False. Stock dividends are distributions of cash to stockholders. | False |
| What is the effect of a stock dividend and a stock split on total assets? | Stock Dividend: NO EFFECT; Stock Split: NO EFFECT |
| A 2-for-1 stock split has the same effect on the number of shares being issued as a: | 100% stock dividend |
| The numerator for computing the rate of return on total assets is: | Net Income + Interest Expense |
| The numerator for computing the rate of return on common equity is: | Net Income - Preferred Dividends |
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