Stockholders' Equity

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If you have difficulty answering the following questions, learn more about this topic by reading our Stockholders' Equity Explanation.

1.	To start a corporation, one makes application to a state. The legal document that the state approves is the _______________  ___  _____________________.

2.	One of the advantages of the corporation form of business as opposed to a partnership form is the ease of transferring _________________.

3.	At a corporation, Assets minus Liabilities is __________________  _________.

4.	Shares of stock that have been issued and have not been reacquired by the issuing corporation are called _____________________ shares.

5.	If a corporation has issued only one type of stock, it is _____________________ stock.

6.	The type of stock that gets its dividend before the common stock gets its dividend is called ___________________ stock.

7.	The holders of ___________ stock elect the corporation's board of directors.

8.	The par value of _____________ stock usually has no economic significance.

9.	The dividend on preferred stock is often expressed as a percentage. To calculate the annual dividend on preferred stock, you multiply the percentage times the _______  _________ of the preferred stock.

10.	If a corporation issues 10% Preferred Stock $100 Par on a day when the financial markets demand 9%, this corporation's 10% Preferred Stock will sell for _______ than its par value.

11.	If a common stock does not have a par value or a stated value, the entire proceeds from issuing the stock is credited to one account entitled _____________  _____________.

12.	Stockholder's equity is subdivided into two major sections: _______  ____________ and ____________  _____________.

13.	The net income of a corporation is closed to the _____________  _____________ account.

14.	Dividends declared by a corporation reduce the _______________  ___________ section of stockholders' equity.

15.	Dividends appear as an expense on the corporation's income statement.	True	False
16.	If the board of directors does not declare the regular quarterly divided on its common stock, the corporation's liabilities will include the omitted dividend.	True	False

17.	The ____________________ date is the date on which the corporation records a liability for its quarterly dividend.

18.	The ______________ date determines which stockholders will receive a declared dividend.

19.	If a corporation declares a small stock dividend, the account that will be reduced by a debit entry is ______________  ___________.

20.	A stockholder will be in the same position with a 3-for-2 stock split or a ______ % stock dividend.

21.	A corporation's own shares of stock that have been reacquired from its stockholders but have not been retired is called ______________  ____________.

22.	The account, Treasury Stock, will have either a zero balance or a ___________ (debit, credit) balance.

23.	If a share of treasury stock is sold for more than its cost, the difference is credited to ________________________________________________.

24.

Treasury stock sales can result in a loss on the corporation's income statement.

True

False

25.	If preferred stockholders have the opportunity to receive more than the stated dividend percentage, the stock is described as ________________________ preferred stock.

26.	Dividends in arrears occur only on ______________________ preferred stock.

27.	Dividends in arrears are reported in the financial statements in the ___________________.

28.	If a preferred stock can be exchanged for a stated number of common shares, it is referred to as _______________________ preferred stock.

29.	The book value per share of preferred stock is the _______  _____________ plus any dividends in _______________.

30.	Earnings per share means earnings per share of ____________  ___________.

31.	A debit balance in Retained Earnings will appear in stockholders' equity on the balance sheet as _____________________________.

32.	The __________  ___  _____________ of a corporation declare the dividends.

33.	The directors of a corporation appoint ______________ to carry out the corporation's policies and directives.

34.	When a small stock dividend is declared, the ______________ value of the new shares is transferred from Retained Earnings to paid-in capital accounts.

35.	A separate portion of stockholders' equity that reports certain gains and losses on hedges, foreign currency translations, and pension liabilities that were not part of net income shown on the income statement is _____________________  _________  ______________________  _____________.