Corporate Finance Assignment – Dividends and stock analysis

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A dividend preference for preferred stock means that

A)Preferred stockholders receive their dividends before common shareholders

B)Dividends are paid quarterly

C)Preferred stockholders prefer dividends more than common stockholders

D)Dividends must be declared stock


Return on equity can be compared to

A)Interest rates paid by a bank

B)Rates of return on other similar investments

C)Return on debt(cost of debt)

DAll of the above


The total amount of stock that a corporation’s charter allows it to issue is referred to as

A)Issued stock

B)Outstanding Stock

C)Common stock

D)Authorized stock


A stock dividend will

A)Increase total equity

B)Not affect total equity

C)Decrease total equity

D)Decrease cash


Stockholder’s equity consits of

A)Long-term assets

B)Paid in capital &retained earnings

C)Paid in capital & par value

D)Retained earnings & cash


Treasure stock is classified as

A)An asset acct

B) A contra asset acct

C)A revenue acct

D)A contra equity acct


The following data regarding its common stock were reported by a corporation:

Authorized shares
Issued shares
Treasury shares

The number of outstanding shares is:






A company issued 60 shares of $100 par value stock for $7,000 cash. The total amount of paid in capital in excess of par is






A company’s board of directors votes to declare a cash dividends of $0.75 per share. The company has 15,000 shares authorized, 10,000 issued, and 9,500 shares outstanding. The total amount of the cash dividends is






Cherry Corp outstanding stock is $100 par, 11% cumulative preferred stock and 2,000 shares of $12 par common stock. Cherry paid $1,600 in cash dividends during the year. No dividends are in arrears. Common stockholders received

A)$ 0.

B)$ 500.




A company had a beginning bal in retained earning of $43,000. It had net income of $6,000 and paid out cash dividends of $5,625 in the current period. The ending bal in retainaed earnings






Earnings that a stockholder receives from a corp is an example of which stockholder right?






The right of common shareholders to protect their proportionate interest in a corporation by having the first opportunity to buy additional proportionate shares of common stock issued by the corporation is called a

A)Preemitive right

B)Proxy right

C)Right to call

D)Voting right


Which of the following is not a right of comon stock ownership?

A)Right to vote in corporate matters

B)Right to share in earnings

C)Right to make purchase decisions

D)Right to share in assets if the company is liquidted


The date the board of director’s votes to gice a dividend to shareholders is called the

A)Date of sharehpolders meetings

B)Date of declaration

C)Date of records

D)Date of payment


Which of the following needs to happen before cash dividends are paid to common stockholders?

A)They are sufficient retained earnings, sufficient cash and a formal declaration of dividends made by the board of directors

B)The dividend amount must be stated on the stock certificate and the board of directors must okay the payment

C)There must be sufficent cash and common stockholders must own the stock for 5 years

D)There needs to be sufficent numbers of stockholders to collect the cash set a side for dividends payments


The amount of income earned per share of a company’s common stock is known as

A)Restricted retained earnings per share

B)Earnings per share

C)Continuing operations

D)Dividends per share

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