Which of the following statements is false? a. the common stock account has a credit balance. b. the additional paid-in capital account has a credit balance. c. common stock may be issued for more than par value. d. the par value of common stock represents the stock's market value.

Which of the following statements is false? a. the common stock account has a credit balance. b. the additional paid-in capital account has a credit balance. c. common stock may be issued for more than par value. d. the par value of common stock represents the stock's market value.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Which of the following statements is false? The cost of debt securities is highest due to their…

A: The situation under which any entity can encounter loss, injury or damage is known as a risk. Risks…

Q: The normal balance for the Treasury Stock account is a debit balance. True or False

A: Treasury Stock is the reacquired stock of own shares. Entry to Purchase of Treasury Stock is:…

Q: True or False, pls explain why 7) Earnings per share will decline in a stock repurchase transaction…

A: Introduction: Shares repurchase: Initially shares are issued to public. After some time the shares…

Q: 14. For available-for-sale securities, a decline in value due to a temporary decline in market value…

A: The question is multiple choice question. Required Choose the Correct Option.

Q: When treasury stock is purchased for more par value of the stock and the cost method is used to…

A: Hi student Since there are multiple questions, we will answer only first question.

Q: True or False Treasury stock is reported in the stockholders' equity section of the balance sheet.

A: Treasury stock is the amount of stock repurchased from open market. It will reduce stockholders…

Q: sed on the Signaling Theory, issuance of common stock is a negative sign.

A: Introduction : In simple words, the signalling theory states that the actions made by the company…

Q: Which of the following statement is false in regards to Share premium? a. It will be shown under…

A: (a) Share premium will be shown under equity section in the balance sheet (b) Share premium will be…

Q: When treasury stock is sold below cost, the Paid-in Capital, Treasury Stock account is debited for…

A: Treasury stock refers to previously issued stock that the issuing business buys back from…

Q: displayed below.] Carmen Camry operates a consulting firm called Help T

A: A retained earnings statement (retained earnings statement) is a financial statement that displays…

Q: Which of the following statements regarding earnings per share is false? It is reported on the…

A: The ratio analysis helps to analyse the financial statements of the business on the basis of various…

Q: Treasury stock is a contra-shareholders' equity account and it shows the total dollar amount a…

A: Treasury stock denotes the shares the company keep on his own treasure after buy back or repurchase.…

Q: Which of the following is False in regards to Share premium account? a. It will be shown under the…

A: THE SHARE PREMIUM ACCOUNT REPRESENTS THE DIFFERENCE BETWEEN THE PAR VALUE OF THE SHARES ISSUED AND…

Q: A stock's par value refers to the: O A. Issue price of the stock. O B. Value assigned per share by…

A: In accounting, the term" stock" generally refers to the force of goods or accoutrements that a…

Q: Which statement is true? a. Stock must have either a par or stated value b. If nominal, par value…

A: a) False. A stock that that has neither par value nor stated value, will be considered on the whole…

Q: Which of the following disclosures regarding stock is not required to be reported on the balance…

A: Financial statements are set up accounts that pass on the business exercises and the monetary…

Q: Which of the following statements is/are correct? i. The sale of stocks is also referred to as…

A: There are two types of financing available to a company equity financing and debt financing.

Q: Earnings per share is a factor used by the stock market to determine stock prices. Select one: True…

A: There are many methods to determine the stock price of a share. Earnings per shares gives the dollar…

Q: From an accounting standpoint, isn't treasury stock just a regular equity account with a normal…

A: The treasury shares are the own shares of the company which are purchased from the shareholders.

Q: How does a 2: 1 stock split (stock-split-up) affect the following two items? Par Value per Share…

A: stock split is a decision by a company's board of directors to increase the number of shares that…

Q: Common stock is typically stated at_ Select one: a. sale value. O b. par value c. Fair market value.…

A: Common stock is the type of ownership interest held by common stock holders who can vote on…

Q: Northwest Utility Company faces increasing needs for capital. Fortunately, it has an Aa3 credit…

A: Weighted cost of the capital includes the weighted cost of debt, weighted cost of equity and…

Q: What is the effect of purchasing treasury stock on a company’s earnings per share and return on…

A: Treasury stock refers to those shares which are repurchased from the existing shares , so this…

Q: The stockholders' equity section of Gingerbread Corp's December 31, 2019 palance sheet in the first…

A: Equity is an ownership of assets that includes debt or other liabilities also. Equity is calculated…

Q: What does it indicate when there are outstanding units of stock

A: Share of a Stock are outstanding implies that the specified number of share of the stock have been…

Q: When computing diluted earnings per share, which of the following will not be considered in the…

A: Diluted earnings per share are calculated considering the potential common shares or convertible…

Q: If common stock is issued for an amount greater than par value, the excess goes to what account? Oa.…

A: The common stock issued is to be presented in balance sheet under liabilities section. It is to…

Q: Why is this statement false. Small stock dividends are accounted for at the stock's par value.

A: This statement is false because: "A small stock dividend are accounted for at market price on the…

Q: PART A: Common stock has seniority relative to preferred stock. True False PART B: Issuance or…

A: Similar to bonds, preferred stocks are higher ranking than common stock. But, bonds have more…

Q: Treasury stock is classified as a(n) O Asset O Liability O Equity O Revenue or gain O Expense or…

A: Stock also known as shares are the securities issued by an entity for the purpose of raising funds…

Q: How does the issuance of common stock affect the accounting equation? a) Increases assets and…

A: The issuance of common stock refers to the process of offering and selling shares of ownership in a…

Q: Describe the accounting for the issuance for cash of no-par value common stock at a price in excess…

A: Accounts that will be affected while issuing common stock takes place are common stock, paid-in…

Q: Distinguish the differences between stock splits and stock dividends.

A: Dividends are the profits of the company which is distributed among the shareholders of the company.…

Q: is common stock decrease debit or credit?

A: Common Stock- It refers to the shares which are issued by the organization within the general…

Q: Choose the incorrect statement below: A. Retained earnings are the funds

A: Option d is incorrect

Q: Treasury stock is generally accounted for by the cost method. O market value method.

A: solution correct answer is cost method explanation under he cost method following entry is passed…

Q: Par (as it relates to common stock) means: no discount or premium it has no meaning the value of the…

A: Par value, also known as face value or nominal value, is the arbitrary dollar amount assigned to…

Q: For the transaction of the purchase of common stock, why are we debiting cash and crediting the…

A: The Total Stockholders Equity is the value of the total capital/equity of the owners of the entity.…

Question

Which of the following statements is false?

a. the common stock account has a credit balance.

b. the additional paid-in capital account has a credit balance.

c. common stock may be issued for more than par value.

d. the par value of common stock represents the stock's market value.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

If most participants in the stock market do not follow what is happening to monetary aggregates, prices of common stock will not fully reflect information about them. Is this statement true? Explain your answer
Statement I. Appropriation reserve is used to restrict earnings available for dividends Statement II. The issuance of stock dividends increases share capital and total shareholders' equity a. Statement I and II are trueb. Statement I and II are falsec. Statement I is true, Statement II is falsed. Statement I is false, Statement II is true
Which one of the following methods is not derived from the principle that the value of a stock is the present vaiue of future dividends. O Discounted cash flow method O Discounted dividend method O Abnormal earnings O Price multiple method O Abnormal earnings growth
If a preferred stock is of the cumulative type, a. dividends cannot be passed if they are earned. b. unpaid dividends of one period must be carried forward and paid in subsequent periods before anything can be paid to common stockholders. c. dividends must be paid, and if not a liability is created. d.dividends must be paid on an equal basis with common stock, so long as earnings permit.
When treasury stock is purchased for cash at more than its par value, what is the effect on total shareholders’ equity under each of the following methods?
Please answer this one
Changes in the fair value of held to maturity securities are: A. not recognized. B. recognized on the income statement and as part of stockholders' equity. C. reported as part of stockholders' equity. D. recognized on the income statement.
Which of the following is FALSE? Group of answer choices Assets + Liabilities = Stockholders' Equity Assets = Liabilities + Stockholders' Equity Assets - Stockholders' Equity= Liabilities None of the above are false.
Which of the following is not a method that may be used to account for treasury shares?a. Cost methodb. Par value methodc. Retained earnings methodd. Constructive retirement methodC
Which of the following is false? An increase in the cost of common share may be due to an increase in share’s beta The cost of common shares can be classified as a cost of retained earnings or cost of issuance of new shares. Floatation cost affects the cost of equity from newly issued stocks and this impacts the weighted average cost of capital The floatation cost which is deducted against the stock issue price should always be considered in all scenarios of computing the cost of ordinary stock.
why is this statement false? Small and large stock dividends have no effect on the Common Stock account.
What is the impact of treasury stock on the presentation of stockholder’s equity? Treasury stock is added to paid-in capital, subtracted from common stock, and added to retained earnings. Treasury stock is subtracted from paid-in capital, common stock, and retained earnings thereby reducing stockholder’s equity. Treasury stock is subtracted from paid-in capital, added to common stock, and retained earnings. Treasury stock is added to paid-in capital, common stock, and retained earnings thereby increasing stockholder’s equity. Stockholders’ equity can increase due to: Inventory is increased. Retained Earnings decrease. Dividends are distributed. Stock is issued and common stock is increased. The Cash Dividends Payable account incurs a liability when: On the record date. On the last day of the period. On the payment date. On the declaration date. provide the correc answer and explain what ciorrect choices