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ACCT 221: Financial Accounting - Quiz 1

A quiz covering key financial accounting concepts, including fundamental accounting principles and transactions.

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    ACCT 221: Financial Accounting - Quiz 1 UMUC ACCT 221 Quiz 1 1. The date on which a cash dividend becomes a binding legal obligation is on the a. declaration date. b. date of record. c. payment date. d. last day of the fiscal year - end. 2. Dividends are predominantly paid in a. earnings. b. property. c. cash. d. stock. 3. Solaris, Inc. has 2,000 shares of 5%, $10 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014. What is the annual dividend on the preferred stock? a. $5 per share b. $1,000 in total c. $10,000 in total d. $.05 per share 4. If a corporation issued $3,000,000 in bonds which pay 5% annual interest, what is the annual net cash cost of this borrowing if the income tax rate is 30%? a. $3,000,000 b. $45,000 c. $150,000 d. $105,000 5. A bond with a face value of $200,000 and a quoted price of 102 ⅛ has a selling price of a. $240,225. b. $204,025. c. $200,225. d. $204,250.

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