One disadvantage of selling stock is that dividends get taxed twice. True or Fal
ID: 2574180 • Letter: O
Question
One disadvantage of selling stock is that dividends get taxed twice. True or False?
Retained earnings is a pot of money, available for operations. True or False?
A large stock dividend affects:
A. Book values for issuing corporation
B. Par Value
C. Current market values
D. Total Owner's Equity value
When a plant asset is disposed of, and cash is paid recording the disposition requires making entries for:
A. gains, losses and depreciation
B. neither gains nor losses, only depreciation
C. gains, losses, accumulated depr.
D. losses/gains, accumulated depr. and cost of asset
A bond issued at a discount indicates that at the date of issue:
A, its contract rate was lower than the prevailing market rate of interest on similar bonds
B, its contract rate was higher than the prevailing market rate of interest on similar bonds
C. the bonds were issued at a price greater than their face value
D. the bonds are noninterest bearing,
When a stock split happens, what effect is there on the balance sheet?
Treasury stock is classified as an investment on the balance sheet. True or False?
List three entries that affect both the Balance Sheet and the Income Statement.
Explanation / Answer
One disadvantage of selling stock is that dividends get taxed twice. True or False?
False, there is no relation between selling of stock & taxation of dividend.
Retained earnings is a pot of money, available for operations. True or False?
True, Retained earnings is the net income which has not been distributed to shareholders as dividend and hence kept for funding the operation.
A large stock dividend affects:
A. Book values for issuing corporation
B. Par Value
C. Current market values
D. Total Owner's Equity value
Option “C. Current market values” is correct
A stock dividend is a dividend payment made in the form of additional shares rather than a cash payout e.g.The board of a public company can approve a 5% stock dividend, which gives existing investors an additional share of company stock for every 20 shares they already own. However, this means that the pool of available equities increases by 5%, diluting the value of existing shares.
When a plant asset is disposed of, and cash is paid recording the disposition requires making entries for:
A. gains, losses and depreciation
B. neither gains nor losses, only depreciation
C. gains, losses, accumulated depr.
D. losses/gains, accumulated depr. and cost of asset
Option “D. losses/gains, accumulated depr. and cost of asset” is correct
Because we have to write off the cost of asset, accumulated Depn at the time of sale and loss/ gain to recognize at the time of sale.
A bond issued at a discount indicates that at the date of issue:
A, its contract rate was lower than the prevailing market rate of interest on similar bonds
B, its contract rate was higher than the prevailing market rate of interest on similar bonds
C. the bonds were issued at a price greater than their face value
D. the bonds are noninterest bearing,
Option “ A, its contract rate was lower than the prevailing market rate of interest on similar bonds” is correct,
Because it is the total of the present value of the interest paid till the maturity and the present value of the refund of the bond value and we take the discount factor to find out the present value the market rate.
When a stock split happens, what effect is there on the balance sheet?
It does not affect anything , it is just like you exchange $100 note into 10 notes of $10.
Treasury stock is classified as an investment on the balance sheet. True or False?
False, it is part of The stockholders' equity section of the balance sheet which is subdivided into three subsections: paid-in capital, retained earnings and treasury stock
List three entries that affect both the Balance Sheet and the Income Statement.
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