Reference no: EM132945749

True or False.

Problem 1. Retained Earnings with credit balance is called Deficit.

Problem 2. The Article of incorporation enumerates the powers and limitations conferred upon the corporation by the government which includes the name of corporation, the authority and duties of the directors and the principal office of the corporation.

Problem 3. When preference share capital is participating, ordinary shares are always given regular dividends with the same rate as that of preference shares, whether they are cumulative or not, as long as there are available dividends.

Problem 4. The Retained Earnings Account of the corporation has a credit balance of P500,000. 80% of this was appropriated for the expansion of the company, while the Cash account has a balance of P150,000. The corporation can only declare dividends up to P150,000 Cash dividends.

Problem 5. Corporate Recapitalization generally affects the total Stockholder's equity of a corporation.

Problem 6. The account Retained Earnings Appropriated for Dividends is debited at the date of declaration.

Problem 7. All the partners in a Limited Partnership are only liable up to their contributions to the partnership only.

Problem 8. The bonus account is debited when there is transfer of capital from one partner to the other.

Problem 9. Asset revaluation may be recorded upon the admission of a new partner whether by purchase or by investment.

Problem 10. Free Interest - Amounts to be Paid to partners are first applied to loan and then on capital.