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Stockholders’ Equity
15 - 23
*104. Lott Co. has outstanding 50,000 shares of 8% preferred stock with a $10 par value and
125,000 shares of $3 par value common stock. Dividends have been paid every year
except last year and the current year. If the preferred stock is cumulative and
nonparticipating and $250,000 is distributed, the common stockholders will receive
a. $0.
b. $170,000.
c. $210,000.
d. $250,000.
Multiple Choice Answers—Computational
Item
71.
72.
73.
74.
75.
Ans.
a
b
b
c
d
Item
76.
77.
78.
79.
80.
Ans.
d
d
b
c
c
Item
81.
82.
83.
84.
85.
Ans.
d
c
a
c
b
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86.
87.
88.
89.
90.
Ans.
d
d
a
c
a
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91.
92.
93.
94.
95.
Ans.
Item
Ans.
Item
Ans.
b
b
b
a
b
96.
97.
98.
99.
*100.
c
a
b
b
b
*101.
*102.
*103.
*104.
d
b
c
b
MULTIPLE CHOICE—CPA Adapted
105.
A corporation was organized in January 2004 with authorized capital of $10 par value
common stock. On February 1, 2007, shares were issued at par for cash. On March 1,
2007, the corporation's attorney accepted 7,000 shares of common stock in settlement for
legal services with a fair value of $90,000. Additional paid-in capital would increase on
February 1, 2007 March 1, 2007
a.
Yes
No
b.
Yes
Yes
c.
No
No
d.
No
Yes
106.
On July 1, 2007, Cole Co. issued 2,500 shares of its $10 par common stock and 5,000
shares of its $10 par convertible preferred stock for a lump sum of $125,000. At this date
Cole's common stock was selling for $24 per share and the convertible preferred stock for
$18 per share. The amount of the proceeds allocated to Cole's preferred stock should be
a. $62,500.
b. $75,000.
c. $90,000.
d. $68,750.
107.
Norton Co. was organized on January 2, 2007, with 500,000 authorized shares of $10 par
value common stock. During 2007, Norton had the following capital transactions:
January 5—issued 375,000 shares at $14 per share.
July 27—purchased 25,000 shares at $11 per share.
November 25—sold 15,000 shares of treasury stock at $13 per share.
Norton used the cost method to record the purchase of the treasury shares. What would
be the balance in the Paid-in Capital from Treasury Stock account at December 31, 2007?