Phoenix ACC 291 Week 4 Practice Questions Chapter 11 Answers (2017)

1. The stockholders of a corporation have unlimited liability.

2. Which of the following is a disadvantage of the corporate business form?

3. If a corporation issues 1,000 shares of $3 par common stock for $7 a share, how much is the legal capital?

4. Harrison, Inc. issued 4,000 shares of common stock at $12 per share. If the stock has a par value of $0.50 per share, which of the following will be part of the journal entry to record the issuance?

5. For what reason might a company acquire treasury stock?

6. Which of the following increases when a corporation purchases treasury stock?

7. Which one of the following is not a right of preferred stockholders?

8. When stock dividends are declared and issued, total stockholders’ equity increases.

9. Dehesa, Inc. has 8,000 shares of 5%, $50 par, cumulative preferred stock and 50,000 shares of $3 par common stock outstanding. No dividends were declared last year, However, the board of directors just declared a $50,000 dividend this year to be paid in 10 days. What amount of the total dividend will be paid to common stockholders?

10. If everything else is held constant, what will cause earnings per share to increase?