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MGMT 200 EXAM 3 (PURDUE UNIVERSITY) NEWEST
2026/2027 EXAM 3 AND PRACTICE EXAM 320 QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||JUST OUT!!!
contributed capital is the amount stockholders have invested in
the company (T or F) - ANSWER-true
The number of shares outstanding is equal to the
number of shares issued minus the number of
shares repurchased. (T or F) - ANSWER-true
Meadows Farm, Inc. issues 5,000 shares of $1 par value
common stock for $10 per share, what would be the effect on
the accounting equation?
a. Increase assets and increase liabilities
b. Increase assets and increase stockholders'
equity
c. Increase assets and increase revenue
d. Increase assets and decrease stockholders'
equity - ANSWER-b. Increase assets and increase stockholders'
equity
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Bampton Corporation issued 15,000 shares of $1 par
value stock for $20 per share. What is not true about
the journal entry to record the issuance?
a. Credit Common Stock $300,000
b. Credit Common Stock $15,000
c. Debit Cash $300,000
d. Credit Additional Paid‐In Capital $285,000 - ANSWER-a.
Credit Common Stock $300,000
Thiel, Inc. issued 5,000 shares of $1 par value stock
for $5 per share. What is true about the journal
entry to record the issuance?
a. Debit Cash $25,000
b. Credit Common Stock $25,000
c. Debit Additional Paid‐In Capital $20,000
d. Debit Common Stock $5,000 - ANSWER-a. Debit Cash
$25,000
Which type of stock may have dividends in arrears?
A. Common stock
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B. Cumulative preferred stock
C. Noncumulative preferred stock
D. Treasury stock - ANSWER-B. Cumulative preferred stock
The word preferred in the phrase preferred stock
means that an owner of preferred stock has some
advantages over a bondholder. (T or F) - ANSWER-false
The Golden, Inc. issues 1,000 shares of 3%, $100 par value
preferred stock at the beginning of 2017. All remaining shares
are
common stock. Golden was not able to pay dividends in 2017,
but
plans to pay dividends of $10,000 in 2018. Assuming the
preferred
stock is noncumulative, how much of the $10,000 dividend will
be
paid to preferred stockholders and how much will be paid to
common stockholders in 2018?
a. $10,000 to preferred stockholders and $0 to common
stockholders.
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b. $6,000 to preferred stockholders and $4,000 to common
stockholders
c. $3,000 to preferred stockholders and $7,000 to common
stockholders.
d. none to preferred stockholders and $10,000 to common
stockholders - ANSWER-c. $3,000 to preferred stockholders and
$7,000 to common
stockholders.
when treasury stock is sold, what is the effect on total
stockholders' equity?
a. decrease
b. increase
c. no effect
d. cannot tell from the given informations - ANSWER-b.
increase
according to generally accepted accounting principles, treasury
stock usually should be recorded at
a. market value
b. par value
MGMT 200 EXAM 3 (PURDUE UNIVERSITY) NEWEST
2026/2027 EXAM 3 AND PRACTICE EXAM 320 QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||JUST OUT!!!
contributed capital is the amount stockholders have invested in
the company (T or F) - ANSWER-true
The number of shares outstanding is equal to the
number of shares issued minus the number of
shares repurchased. (T or F) - ANSWER-true
Meadows Farm, Inc. issues 5,000 shares of $1 par value
common stock for $10 per share, what would be the effect on
the accounting equation?
a. Increase assets and increase liabilities
b. Increase assets and increase stockholders'
equity
c. Increase assets and increase revenue
d. Increase assets and decrease stockholders'
equity - ANSWER-b. Increase assets and increase stockholders'
equity
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Bampton Corporation issued 15,000 shares of $1 par
value stock for $20 per share. What is not true about
the journal entry to record the issuance?
a. Credit Common Stock $300,000
b. Credit Common Stock $15,000
c. Debit Cash $300,000
d. Credit Additional Paid‐In Capital $285,000 - ANSWER-a.
Credit Common Stock $300,000
Thiel, Inc. issued 5,000 shares of $1 par value stock
for $5 per share. What is true about the journal
entry to record the issuance?
a. Debit Cash $25,000
b. Credit Common Stock $25,000
c. Debit Additional Paid‐In Capital $20,000
d. Debit Common Stock $5,000 - ANSWER-a. Debit Cash
$25,000
Which type of stock may have dividends in arrears?
A. Common stock
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B. Cumulative preferred stock
C. Noncumulative preferred stock
D. Treasury stock - ANSWER-B. Cumulative preferred stock
The word preferred in the phrase preferred stock
means that an owner of preferred stock has some
advantages over a bondholder. (T or F) - ANSWER-false
The Golden, Inc. issues 1,000 shares of 3%, $100 par value
preferred stock at the beginning of 2017. All remaining shares
are
common stock. Golden was not able to pay dividends in 2017,
but
plans to pay dividends of $10,000 in 2018. Assuming the
preferred
stock is noncumulative, how much of the $10,000 dividend will
be
paid to preferred stockholders and how much will be paid to
common stockholders in 2018?
a. $10,000 to preferred stockholders and $0 to common
stockholders.
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b. $6,000 to preferred stockholders and $4,000 to common
stockholders
c. $3,000 to preferred stockholders and $7,000 to common
stockholders.
d. none to preferred stockholders and $10,000 to common
stockholders - ANSWER-c. $3,000 to preferred stockholders and
$7,000 to common
stockholders.
when treasury stock is sold, what is the effect on total
stockholders' equity?
a. decrease
b. increase
c. no effect
d. cannot tell from the given informations - ANSWER-b.
increase
according to generally accepted accounting principles, treasury
stock usually should be recorded at
a. market value
b. par value
