Grading Summary

These are the automatically computed results of your exam. Grades for essay questions, and comments from your instructor, are in the "Details" section below.

Date Taken: 2/1/2012Time Spent: 34 min , 06 secsPoints Received: 12 / 20  (60%)

Question Type: # Of Questions: # Correct:

Multiple Choice 5 3

Grade Details

 1. Question : (TCO E) Stockholders' equity is generally classified into two major categories: 

  Student Answer: contributed capital and appropriated capital.

  appropriated capital and retained earnings.

  retained earnings and unappropriated capital.

  earned capital and contributed capital.

  Instructor Explanation: Chapter 15. Page 744

  Points Received: 4 of 4

  Comments:

 2. Question : (TCO E) A "secret reserve" will be created if

  Student Answer: inadequate depreciation is charged to income.

  a capital expenditure is charged to expense.

  liabilities are understated.

  stockholders' equity is overstated.

  Instructor Explanation: Chapter 15. Page 748

  Points Received: 4 of 4

  Comments:

 3. Question : (TCO E) Norton Company issues 4,000 shares of its $5 par value common stock having a market value of $25 per share, and 6,000 shares of its $15 par value preferred stock having a market value of $20 per share, all for a lump sum of $192,000. What amount of the proceeds should be allocated to the preferred stock?

  Student Answer: $172,000

  $120,000

  $104,727

  $90,000

  Instructor Explanation:

(4,000 X $25) + (6,000 X $20) = $220,000 ($120,000 ÷ $220,000) X $192,000 = $104,727.Chapter 15.

  Points Received: 0 of 4

  Comments:

 4. Question : (TCO F) Anders, Inc., has 5,000 shares of 5%, $100 par value, cumulative preferred stock and 20,000 shares of $1 par value common stock outstanding at December 31, 2011. There were no dividends declared in 2009. The board of directors declares and pays a $45,000 dividend in 2010 and in 2011. What is the amount of dividends received by the common stockholders in 2011?

  Student Answer: $15,000

  $25,000

  $45,000

  $0

  Instructor Explanation:

5,000 X $100 X .05 = $25,000 ($45,000 X 2) - ($25,000 X 3) = $15,000. Chapter 15.

  Points Received: 4 of 4

  Comments:

 5. Question : (TCO F) Written, Inc. has outstanding 300,000 shares of $2 par common stock and 60,000 shares of no-par 8% preferred stock with a stated value of $5. The preferred stock is cumulative and nonparticipating. Dividends have been paid in every year except the past two years and the current year.

Assuming that $63,000 will be distributed as a dividend in the current year, how much will the preferred stockholders receive?

  Student Answer: $21,000.

  $24,000.

  $48,000.

  $63,000.

  Instructor Explanation:

60,000 X $5 X .08 X 3 = $72,000 > $63,000. Chapter 15.