T4-5

Question 1

issuing stock entry

Answer 1

a. Debit cash or item received
b. Credit common/preferred stock
c. Credit paid in capital in excess of par value

Question 2

purchasing treasury stock

Answer 2

a. Credit Cash, Debit Treasury Stock

b. TREASURY STOCK IS CONTRA-EQUITY

Question 3

reissuing treasury stock entry

Answer 3

a. debit cash, debit treasury stock

Question 4

stock split

Answer 4

a. Distribution of 100% or more of stock to stockholders
b. Stock shares increase
c. Par value per share decreases
d. Total par value no change

Question 5

Operating Income on Income statement reporting

Answer 5

i. Total Revenue – (cost of revenue + operating expenses)

ii. Negative number means loss

Question 6

Income from continuing operations

Answer 6

i. Mirrors Non-Recurring Event tab
ii. Total Income, Earnings before interest and taxes, interest expense, income before tax, income tax expense, minority interest

Question 7

discontinued operations

Answer 7

i. Listed under non-recurring events