All of the following are advantages of issuing bonds rather than stock except
payment of bond interest is not required.
Deferred income taxes arise when
there is a discrepancy between financial reporting requirements and income tax filing requirements.
A bond with a face value of $1,000 has a current price quote of 99.00. This bond is selling for
Crowley Corporation purchased a building on January 2 by signing a long-term $600,000 mortgage with monthly payments of $5,500. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment is:
Mortgage Payable 500
Mortgage Interest Expense 5,000
The purpose of a statement of stockholders' equity is to
summarize the changes in the components of stockholders' equity for a period of time.
The term used to describe the allocation of the cost of an intangible asset to the periods it benefits is
Which of the following would not be an account in the general ledger of a corporation?
Dividends in Arrears
Shares of treasury stock are
issued shares that have been bought back by the corporation and are being held by the corporation.
Dividends in arrears are dividends on
cumulative preferred stock that have not been declared for some specified period of time.
If Willis Corporation has 80,000 shares of common stock authorized, 50,000 shares of common stock issued, and holds 2,000 shares of common stock as treasury stock, the total number of outstanding shares of Willis Corporation amounts to
Use the following information to answer the question below.
The following accounts appear in the ledger of Sayre Corporation on December 31, 2010
Additional Paid-in Capital, Preferred7,000
Additional Paid-in Capital, Common18,000
A balance sheet prepared on December 31, 2010 , would report total stockholders' equity of
Which of the following statements is not descriptive of common stock?
Dividends paid are an expense for the issuing corporation.
Which of the following would be considered a capital expenditure?
Installation of a solar heating system
Which of the following income statement figures probably would be the best predictor of a corporation's future performance?
Income from continuing operations
Shank Corporation uses a different depreciation method for its income tax return than it does for its income statement. Consequently, the corporation has a credit balance in its Deferred Income Taxes account. This balance should be classified as a
Which of the following is not an advantage of issuing long-term debt?
The risk of becoming bankrupt is reduced.
Which of the following would have the least likelihood of being treated as an extraordinary item?
Gain or loss on sale of equipment
The preparation of a statement of stockholders' equity makes which other financial statement unnecessary?
Statement of retained earnings