Reference no: EM132505110

Question 1) Outstanding balances for service-type warranties are

A) expensed against revenues in the current period.

B) not considered separate performance obligations.

C) reported the same way as unearned revenues.

D) all of the above are true.

Question 2) Which date is used to determine which shareholders will receive the declared dividend?

A) date of record

B) date of declaration

C) ex-dividend date

D) date of payment

Question 3) A $1,000, two-year bond is issued on January 1, 2020 with a coupon rate of 8%. The market demands a yield rate of 10% for investments of similar risk. Interest will be paid on June 30th and December 31st each year. On January 1, 2020, the selling price of the bond will be

A) $1,000.

B) less than $1,000.

C) greater than $1,000.

D) cannot be determined from the information.

Question 4) On January 1, The Blue Azul Diving Co. had total shareholders' equity as shown below when their shares were selling at $25 per share:

Common shares (125,000 shares)...................... $2,500,000

Retained earnings........................................... 4,000,000

Total shareholders' equity...................... $6,500,000

Assume the company declared and issued a 50% stock dividend. The effect of this dividend would

A) increase common shares by $1,250,000 and shares issued and outstanding by 62,500.

B) increase common shares by $1,250,000 with no change in the number of issued and outstanding shares.

C) leave total shareholders' equity unchanged but increase the number of shares issued and outstanding to 187,500.

D) reduce retained earnings by $2,000,000 and double the number of shares issued and outstanding.