Accounting Essay

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FINANCIAL REPORTING (INCLUDING EARNINGS PER SHARE) MULTIPLE CHOICE QUESTIONS Select the appropriate response. 1. Which of the following is considered as extraordinary by the accounting profession? a. Write-down or write-off of receivables, inventory, and intangible assets. b. Gains and losses from the sale or abandonment of equipment used in a business. c. Effects of a strike, including those against competitors and major suppliers. d. Flood damage from unusually heavy rains in a normally dry environment. 2. Which of the following would not be reported as a separate component on the income statement? a. Income from continuing operations b. Discontinued operations c. Prior period adjustment d. Extraordinary item 3. Oakwood Furniture Corporation had 100,000 shares of common stock outstanding on January 1. An additional 50,000 shares were issued on July 1, and 25,000 shares were reacquired on September 1. What was the weighted-average number of share outstanding during the year? a. 140,000 b. 125,000 c. 118,750 d. 116,667 4. Sparks Corporation had 15,000 shares of common stock outstanding on January 1, and issued an additional 5,000 shares on June 1. There was no preferred stock outstanding. The corporation reports net income of $200,000. How much is basic earnings per share (to the nearest cent) for the calendar year? a. $10.00 b. $11.16 c. $11.43 d. $13.33 5. Sparks Corporation had 15,000 shares of common stock outstanding on January 1, and issued an additional 5,000 shares on June 1. There was preferred stock outstanding, and dividends on the preferred stock amounted to $20,000. The corporation reports net income of $200,000. The preferred stock is not convertible. How much is basic earnings per share (to the nearest cent) for the calendar year? a. $9.00 b. $10.00 c. $10.05 d. $10.29 6. If a corporation has total stockholders' equity of

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