11.When common stock is issued, the par value, or stated value, of the shares issued is recorded in the Common Stock account.          12.Organization costs are carried indefinitely as an intangible asset in the records of the corporation.          13.Organization costs are often expensed when incurred.          14.Preferred Stock is shown in the Stockholders' Equity section of the balance sheet.          15.The amount received in excess of the par value of preferred stock issued is recorded in an account called Paid-in Capital in Excess of Par Value—Preferred Stock.        […]

True / False Questions  1.The Bonds Payable account would be credited for $104,000 to record the issuance of $100,000 par value, 10 percent bonds at a market price of 104.          2.Bonds are often issued as a means of raising capital to pay off short-term debt.          3.The IRS requires companies to issue couponbonds in order to track taxable interest payments made to the bond holders.          4.When a corporation pays bond interest, Bond Interest Expense is debited.          5.Amortizing bond premiums over the period from the issue date to the maturity […]

    11.If retained earnings are appropriated for bond retirement, a bond retirement sinking fund must be established.          12.The Bond Sinking Fund Investment account is reported as an investment in the Assets section of the balance sheet.          13.When bonds are issued at a price below face value, the Discount on Bonds Payable account is credited for the difference between the issue price and the face value.          14.Interest on bonds must be paid in full even when the corporation operates at a loss.          15.Bond interest is not deducted when […]

    65.Which of the following statements is correct?    A. The Common Stock Dividends Distributable account is shown as a current liability on the balance sheet.   B. When a stock dividend is distributed, no assets leave or enter the corporation.   C. When a stock dividend is declared, the total amount debited to Retained Earnings is the par value, or stated value, of the shares to be issued.   D. When a stock dividend is declared, the total amount of the dividend is debited to the Common Stock account.         66.Which of the following statements is not correct?    A. The entry […]

True / False Questions  1.Usually, there is a difference between the net income reported on the income statement and the net cash from operating activities shown on the statement of cash flows.          2.The statement of cash flows provides information about cash flows from operating activities, investing activities, and financing activities.          3.By analyzing past cash flows, financial statement users can identify the primary sources and uses of cash.          4.An increase or decrease in accounts payable during a fiscal period has no effect on the net cash provided by operating activities.        […]