88 which of the following correctly describes the recording of a dividend declaratio 4314235

88.Which of the following correctly describes the recording of a dividend declaration by a company's board of directors? 
 

A. A debit to retained earnings and a credit to cash.

B. A debit to additional paid-in capital and a credit to dividends payable.

C. A debit to cash and a credit to retained earnings.

D. A debit to retained earnings and a credit to dividends payable.

89.Superior has provided the following information for its recent year of operation:

The common stock account balance at the beginning of the year was $20,000 and the year-end balance was $25,000.
The additional paid-in capital account balance increased $2,500 during the year.
The retained earnings balance at the beginning of the year was $75,000 and the year-end balance was $91,000.
Net income was $26,000.

How much were Superior's dividend declarations during its recent year of operation?  
 

A. $10,000.

B. $42,000.

C. $26,000.

D. The dividend declarations cannot be determined from the information provided.

90.Superior has provided the following information for its recent year of operation:

The common stock account balance at the beginning of the year was $20,000 and the year-end balance was $25,000.
The additional paid-in capital account balance increased $2,500 during the year.
The retained earnings balance at the beginning of the year was $75,000 and the year-end balance was $91,000.
Net income was $26,000.

How much did Superior sell its common stock for during the year?  
 

A. $5,000.

B. $2,500.

C. $7,500.

D. $27,500.

91.Which of the following statements is correct?  
 

A. Assets normally have a credit balance and are increased with debits.

B. Assets normally have a debit balance and are increased with credits.

C. Liability accounts normally have debit balances and are increased with debits.

D. Stockholders' equity accounts normally have credit balances and are increased with credits.

92.Which of the following journal entries is correct when a business entity purchases land costing $30,000 by signing a one-year note payable?  
 

A. Cash30,000

    Notes Payable 30,000

B. Land30,000

    Accounts payable 30,000

C. Land30,000

    Notes Payable 30,000

D. Notes Payable30,000

    Land 30,000

93.Which of the following journal entries is correct when a business entity issues common stock, above par value, to stockholders in exchange for cash?  
 

A. Cashxxx

      Common stock xxx

      Retained earnings xxx

B. Cashxxx

      Common stock xxx

      Additional paid-in capital xxx

C. Cashxxx

      Investments xxx

D. Common stockxxx

      Cash xxx

94.Which of the following journal entries is correct when a business entity purchases a building by paying cash and by signing a note payable for the balance?  
 

A. Buildingxxx

      Cash xxx

      Notes Payable xxx

B. Buildingxxx

      Cash xxx

C. Cashxxx

      Notes Payable xxx

      Building xxx

D. Buildingxxx

      Cash xxx

      Notes Payable xxx

95.Which of the following journal entries is correct when a business entity pays cash for advertising to be used next year?  
 

A. Cashxxx

      Advertising expense xxx

B. Advertising expensexxx

      Cash xxx

C. Cashxxx

      Prepaid advertising expense xxx

D. Prepaid advertising expensexxx

      Cash xxx

96.Which of the following journal entries is correct when a business entity uses cash to pay an account payable?  
 

A. Accounts Payablexxx

      Cash xxx

B. Accounts Receivablexxx

      Cash xxx

C. Cashxxx

      Accounts Payable xxx

D. Cashxxx

      Notes Payable xxx

97.Which of the following transactions would result in an increase in the current ratio? 
 

A. Collection of cash from an account receivable.

B. Selling shares of stock to stockholders in exchange for cash.

C. Purchasing a building with cash.

D. Declaration of a cash dividend by the board of directors.