Instructions
1. What is the difference between a stock dividend and a stock split?
2. What are organization expenses? Provide a couple of
examples.
3. How are EPS results computed for a corporation with no
preferred stock? What is the main limitation of using book value per share to value a corporation?
4. List the general rights of common stockholders.
5. A corporation reacquires 10,000 shares of its own $25 par common stock for $420,000 recording it at cost. (a) what effect does this transaction have on revenue or expense for the period?(b) What effect does it have on stockholder’s equity?
6. Why do laws place limits on treasury stock purchases?