Multiple choice questions based on stock

Assignment Help Financial Accounting

Reference no: EM13356666

Multiple choice questions based on stock valuation.

1. Carter Corporation had net income of $250,000 and paid dividends of $50,000 to common stockholders and $20,000 to preferred stockholders in 2008. Carter Corporation's common stockholders' equity at the beginning and end of 2008 was $870,000 and $1,130,000, respectively. There are 100,000 weighted-average shares of common stock outstanding.

Carter Corporation's earnings per share for 2008 was

a. $2.50.

b. $2.30.

c. $2.00.

d. $1.80.

2. Kim, Inc. issued 5,000 shares of stock at a stated value of $10/share. The total issue of stock sold for $15/share. The journal entry to record this transaction would include a

a. debit to Cash for $50,000.

b. credit to Common Stock for $50,000.

c. credit to Paid-in Capital in Excess of Par Value for $25,000.

d. credit to Common Stock for $75,000.

Reference no: EM13356666

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