Quiz Ch 10 – Retained Earnings and Statement Accuracy
Financial Accounting
Thomas, Tietz, and Harrison
12th Edition
Which of the following statements about the retained earnings account is incorrect?
Which of the following statements about the retained earnings account is incorrect?
What is the class of stock assumed if a corporation has only one class of stock?
Identify the stockholder’s right of ownership that is NOT included in the given options.
The power to declare a dividend lies with the Vice President of Finance.
The stockholders’ equity section of the balance sheet reports treasury stock.
Dividend payments are classified as a financing activity since the company is compensating stockholders for the use of their capital.
Reporting the purchase of treasury stock on the statement of cash flows is classified as a financing activity.
Treasury stock is a stockholders’ equity account with a contra balance.
The preferred stockholder generally has the discretion to convert convertible preferred stock into the issuer’s common stock.
Corporations can sell stocks directly or use an underwriter.