Question Details

The authorized stock of a corporation




	1.	A corporation has the following account balances: Common stock, $1 par value, $60,000; Paid-in Capital in Excess of Par, $1,300,000. Based on this information, the
a.	legal capital is $1,360,000.
b.	number of shares issued are 60,000.
c.	number of shares outstanding are 1,360,000.
d.	average price per share issued is $22.50.



	2.	The authorized stock of a corporation
a.	only reflects the initial capital needs of the company.
b.	is indicated in its by-laws.
c.	is indicated in its charter.
d.	must be recorded in a formal accounting entry.



	3.	When stock is issued for legal services, the transaction is recorded by debiting Organization Expense for the
a.	stated value of the stock.
b.	par value of the stock.
c.	market value of the stock.
d.	book value of the stock.


	4.	If Vickers Company issues 4,000 shares of $5 par value common stock for $140,000,
a.	Common Stock will be credited for $140,000.
b.	Paid-In Capital in Excess of Par will be credited for $20,000.
c.	Paid-In Capital in Excess of Par will be credited for $120,000.
d.	Cash will be debited for $120,000.


	5.	If common stock is issued for an amount greater than par value, the excess should be credited to
a.	Cash.
b.	Retained Earnings.
c.	Paid-in Capital in Excess of Par.
d.	Legal Capital.





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