Quiz Ch 10 – T/F Non-Cash Asset Exchange for Common Stock
Financial Accounting
Thomas, Tietz, and Harrison
12th Edition
A company may exchange assets for common stock instead of cash.
A company may exchange assets for common stock instead of cash.
A liability is recorded for unpaid dividends on cumulative preferred stock.
The market value per share equals the price-earnings ratio.
A positive balance in Retained Earnings signifies that a company has earned more than its losses and declared dividends over its lifetime.
Retained Earnings debit balance account signifies a deficit in Retained Earnings.
Retained Earnings contain cash allocated for stockholder dividends.
A corporation is a separate legal entity from its owners.
The par value of a stock is of greater concern to stockholders than any other value.
The right to vote in the election of the board of directors is held by the stockholder.
If a corporation pays income taxes, its stockholders are not required to pay taxes on the dividends received.