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Chapter 21 - Corporate Earnings and Capital Transactions
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78. The Dever Corporation is authorized to issue 3,000 shares of 8 percent, $50 par-value
preferred stock and 10,000 shares of no-par-value common stock with a stated value of $20
per share. On December 31, 2013, 1,000 shares of preferred stock and 4,000 shares of
common stock are issued and outstanding. The corporation's transactions affecting
stockholders' equity during 2014 are given below. Record the transactions on page 8 of a
general journal. Omit descriptions.
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79. The Santa Fe Corporation is authorized to issue 6,000 shares of 4 percent, $100 par-value
preferred stock and 20,000 shares of no-par-value common stock with a stated value of $40
per share. On December 31, 2013, 2,000 shares of preferred stock and 8,000 shares of
common stock are issued and outstanding. The corporation's transactions affecting
stockholders' equity during 2014 are given below. Record the transactions on page 15 of a
general journal. Omit descriptions.
Chapter 21 - Corporate Earnings and Capital Transactions
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80. The Intrepid Corporation is authorized to issue 10,000 shares of 6 percent, $100 par-value
preferred stock and 50,000 shares of $2 par-value common stock On December 31, 2013,
1,000 shares of preferred stock and 20,000 shares of common stock are issued and
outstanding. The corporation's transactions affecting stockholders' equity during 2014 are
given below. Record the transactions on page 8 of a general journal. Omit descriptions.
Chapter 21 - Corporate Earnings and Capital Transactions
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Chapter 21 - Corporate Earnings and Capital Transactions
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Matching Questions
85. Match the accounting terms with the description by entering the proper number.
1. Equity account used to record par, or stated, value
of shares to be issued as the result of the declaration
of a stock dividend
Statement of
stockholders' equity.
6
2. A formal declaration of an intention to restrict
dividends
Donated capital.
11
3. The amount of taxes that will be payable in the
future as a result of the difference between taxable
income and income for financial statement purposes
in the current year and in past years
Paid-in capital.
4
4. Capital acquired from capital stock transactions
Stock dividend.
12
5. The date on which the specific stockholders to
receive a dividend are determined
Appropriation of
retained earnings.
2
6. A financial statement that provides an analysis
reconciling the beginning and ending balance of each
of the stockholders' equity accounts
Common Stock
Dividend Distributable
account.
1
7. The total equity applicable to a class of stock
divided by the number of shares outstanding
Retained earnings.
9
8. When a corporation issues two or more shares of
new stock to replace each share outstanding without
making any changes in the capital accounts
Stock split.
8
9. The cumulative profits and losses of the
corporation not distributed as dividends
Extraordinary,
nonrecurring items.
10
10. Transactions that are highly unusual, clearly
unrelated to routine operations, and that do not
frequently occur
Payment date.
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11. Capital resulting from the receipt of gifts by a
corporation
Stockholders of
record.
13
12. Distribution of the corporation's own stock on a
pro rata basis that results in conversion of a portion
of the firm's retained earnings to permanent capital
Book value (stock).
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13. Stockholders in whose name shares are held on
date of record and who will receive a declared
dividend
Declaration date.
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14. The date on which the board of directors declares
a dividend
Record date.
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15. The date that dividends are paid
Statement of retained
earnings.
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16. A financial statement that shows all changes that
have occurred in retained earnings during the period
Treasury stock.
17
17. A corporation's own capital stock that has been
issued and reacquired; the stock must have been
previously paid in full and issued to a stockholder
Deferred income
taxes.
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