When an entity declares dividends *Only the outstanding shares are entitled toshare dividendsOnly the issued shares are entitled todividendsBoth the issued and outstanding shares,O including reacquired shares, are entitled todividendsOnly the outstanding ordinary shares areentitled to the dividends

The dividend is the amount of available retained earnings distributed to the shareholders.

Answered: When an entity declares dividends *…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter21: Corporations: Taxes, Earnings, Distributions, And The Statement Of Retained Earnings

Section: Chapter Questions

Problem 1MC

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Who are entitled to dividends? a. Issued and subscribed shares b. Outstanding and subscribed shares c. Issued shares d. Issued and Outstanding shares
Share dividends distributable is included in the statement of financial position O As a current liability O As a noncurrent liability O As an adjunct account to share capital As a contra-account to share capital
Which of the following is entitled to dividends? Total outstanding liability Total authorized shares Total shares issued Total shares issued, net of treasury shares What is the date on which the fair value of the equity instrument granted is measured? Grant date Report date Measurement date Exercise date
When a small, share capital dividend is declared, Retained Earnings is debited for the a. par value of the share capitalb. fair market value of the share capital on the date of recordc. fair market value of the share capital on the date of declarationd. fair market value of the share capital on the date of distribution
The amount attributable to every share outstanding in case a corporation is liquidated.A. book valueB. par valueC. stated valueD. Market value
1. The issuer of an ordinary share dividend to ordinary shareholders should transfer from retained earnings to contributed capital an amount equal to the a. fair value of the shares issued. b. par or stated value of the shares issued. c. book value of the shares issued. d. minimum legal requirements. 2. Statement 1: Treasury shares are a company’s own shares that have been reacquired and retired. Statement 2: The cost method records all transactions in treasury shares at their cost and reports the treasury shares as a deduction from ordinary shares. a. Only statement 1 is correct b. Only statement 2 is correct c. Both statements are correct d. Both statements are incorrect. 3. The declaration and issuance of a share dividend a. increases ordinary shares outstanding and increases total equity. b. increases retained earnings and increases total equity. c. decreases retained earnings but does not change total equity. d. may increase share premium but does not change total…
Indicate whether the following actions would (+) increase, (-) decrease, or (0) not affect Bernal Inc.'s total assets, liabilities and shareholders' equity: Shareholders' Assets Liabilities Equity Declaring a cash dividend 2. Paying the cash dividend declared in no. 1 1. 3. Declaring a share dividend Issuing share certificates for the 4. share dividend declared in no. 3 Authorizing and issuing share certificates in a share split 5.
Subscriptions receivable from sale of shares which are not collectible currently shall be presented asRequired to answer. Single choice. a. current assets b. deduction from the related subscribed share capital in the shareholder's equity section c. long-term investment d. other asset.
Which of the following is a reserve of a limited liability company? A. DebenturesB. Ordinary share capitalC. Retained earningsD. Ordinary stock
Dividends declared on redeemable preference shares are recognized O By a debit to retained earnings O By a credit to retained earnings O In a profit or loss In other comprehensive income
What is the entry to record issuance of shares after all cash have been received from a share subscription, assuming an entry to record ordinary shares authorized was made at the time of incorporation? * a. Dr. Subscribed ordinary shares and Cr. Ordinary shares b. Dr. Subscribed ordinary shares and Cr. Ordinary shares as well as Share premium c. Dr. Subscribed ordinary shares and Cr. Unissued ordinary shares d. Dr. Subscriptions receivable and Cr. Subscribed ordinary shares as well as Share premium
Which of the following is a current liability? A dividend payable in the form of additional ordinary shares. Dividend in arrears on preference shares. A cash dividend payable to preference shareholders. All of these.

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