Gains on sale of treasury shares (cost method) should be credited to •Share premium – treasury •Ordinary share •Gain on sale of treasury •Retained earnings 2. When share without par value and stated value are sold, the proceed should be credited to a. Profit or Loss b. Retained Earnings c. Share Capital d. Share premiu

Gains on sale of treasury shares (cost method) should be credited to •Share premium – treasury •Ordinary share •Gain on sale of treasury •Retained earnings 2. When share without par value and stated value are sold, the proceed should be credited to a. Profit or Loss b. Retained Earnings c. Share Capital d. Share premiu

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Statement I. Book value per share is tantamount to earnings per share Statement II. Dividends payable in noncash asset should be charged to accumulated profits at fair value of the noncash asset a. Statement I and II are trueb. Statement I and II are falsec. Statement I is true, Statement II is falsed. Statement I is false, Statement II is true
The declaration and issuance of a share dividend a. increases ordinary shares outstanding and increases total equity. b. increases retained earnings and increases total equity. c. decreases retained earnings but does not change total equity. d. may increase share premium but does not change total equity.
Contributed capital does not include a. Preference shares b. Share premium on preference shares c. Capital accumulated by retention of earnings d. Ordinary shares
10. Explain the components of the shareholders' equity section of the statement of financial position (balance sheet) 11. Identify and discuss the two components of contributed capital. 12. Identify the different types of dividends. How much is debited to Retained Earnings upon declaration of each types of dividends? 13. How will you distinguish a small from large share capital (stock) dividend?
The Share Premium-Ordinary account represents the amount of legal capital. is reported as part of equity on the statement of financial position. is credited when a no-par share does not have a stated value. normally has a debit balance. OOO
The ____________________per share is the amount of income attributable to each share ofcommon stock.a. earningsb. market valuec. book valued. preferred value
Topic: Payout Policy What is the advantage(s) of dividends against retained earnings?
3. The amount attributable to every share of ordinary share capital outstanding during the period. a. Par value b. Stated value c. Carrying value d. Bookvalue
A company’s publicly listed shares: a. Can be traded on any share market around the world b. Represent an ownership claim on the company’s real assets (net of liabilities) c. Are guaranteed to provide a dividend cash-flow d. All of the above e. None of the above
IWhich of the following transactions does not involve a cash flow? * O Dividend received O Issue of share capital O issue of share dividends O Prepayment of rent
When using the equity method of accounting, when is revenue recorded on the books of the investor company?a. When the fair value of the affiliate stock increases.b. When a dividend is received from the affiliate.c. When the affiliate company reports net income.d. Both b and c above.
question 1 choose the correct answer from the choices