Question 1. Stockholders' equity (Points : 2)
is usually equal to cash on hand.
includes paid-in capital and liabilities.
includes retained earnings and paid-in capital.
is shown on the income statement.
Question 2.2. Which statement below is NOT a reason for a corporation to buy back its own stock? (Points : 2)
Resale to employees
Bonus to employees
For supporting the market price of the stock
To increase the shares outstanding
Question 3.3. Current liabilities are (Points : 2)
due but not receivable for more than one year.
due but not payable for more than one year.
due and receivable within one year.
due and payable within one year.
Question 4.4. Gross earnings for a payroll period less payroll deductions are referred to as (Points : 2)
Question 5.5. What options does a business have when financing operations? (Points : 2)
Both debt financing and equity financing
Question 6.6. How is treasury stock shown on the balance sheet? (Points : 2)
As an asset
As a decrease in stockholders' equity
As an increase in stockholders' equity
Treasury stock is not shown on the balance sheet.
Question 7.7. The total earnings of an employee for a payroll period are referred to as (Points : 2)
pay net of taxes.
Question 8.8. An employee receives an hourly rate of $27, with time and a half for all hours worked in excess of 40 during a week. Payroll data for the current week are as follows: hours worked, 46; federal income tax withheld, $350; cumulative earnings for year prior to current week, $99,700; social security tax rate, 6.0% on maximum of $106,800; and Medicare tax rate, 1.5% on all earnings. What is the net pay for the employee? (Points : 2)
Question 9.9. Which of the following would most likely be classified as a current liability? (Points : 2)
Two-year notes payable
Question 10.10. A corporation has 50,000 shares of $100 par value stock outstanding. If the corporation issues a 4-for-1 stock split, the number of shares outstanding after the split will be (Points : 2)