Accountıng Iı

Yanıt Açıklaması: Dividends are distributions of cash, other property, or share of the business to the shareholders of a corporation on a pro rata (proportional to ownership) basis. In other words, a dividend is a distribution of some portion of earnings to the shareholders by a corporation. The correct answer is D.

Yanıt Açıklaması: As an important characteristic, shareholders are not personally responsible for the corporation’s liabilities. This means that shareholders’ possible loss is limited with their capital investment. Hence, the creditors cannot make any claim on shareholders’ personal assets. This characteristic of corporation is essential for the shareholders because their personal assets are protected and the corporation may raise may raise more capital from shareholders. Also, the government and related regulators design more regulations and try to monitor corporations to protect shareholders’ and creditors’ claims. Another characteristic is the transferability of the shares. This characteristic is essential for shareholders since it is flexible. They can transfer corporation’s shares to another one. The cancellation of the corporation does not depend on the death of any shareholder or their choices to cancel it. In other words, the corporation is a permanent organization. The transfer of the shares, anyone’s death or withdrawal do not put an end to the corporation. The correct answer is D.

Yanıt Açıklaması: Share dividend is a distribution of a corporation’s own shares to the shareholders as dividends. The correct answer is C.

Yanıt Açıklaması: The direct method shows each major class of gross cash receipts and gross cash payments. The direct method shows all cash receipts and cash payments from operating activities.

Yanıt Açıklaması: Liquidation: When a corporation goes out, shareholders may receive their proportion- ate share of any asset that still remains.

Yanıt Açıklaması: Present Value of the Principal 100,000 TL x 0.74726 (Appendix A, Table 1, n: 10, i:3%) 74,409 TL Present Value of the Interest Payments 4,000 TL x 8.53020 (Appendix A, Table 2, n: 10, i: 3%) 34,121 TL Present value (selling price) of the bonds 108,530 TL The correct answer is B.

Yanıt Açıklaması: As an important characteristic, shareholders are not personally responsible for the corporation’s liabilities. This means that shareholders’ possible loss is limited with their capital investment. Hence, the creditors cannot make any claim on shareholders’ personal assets. This characteristic of corporation is essential for the shareholders because their personal assets are protected and the corporation may raise may raise more capital from shareholders. The correct answer is D.

Yanıt Açıklaması: The indirect method adjusts accrual basis net profit or loss for the effects of non-cash transactions. Indirect method relies on necessary additions and subtractions from net profit to find operating cash flows. Indirect method starts with net income and reconciles to net cash provided by operating activities.

Yanıt Açıklaması: Liquidity is an indicator of reliability level for a company in terms of either survival or credibility.The correct answer is B.

Yanıt Açıklaması: To record the declaration of a small share dividend with its market value, the Retained Earnings account should be debited for market value. A shareholders’ equity account named Common Share Dividend Distributable is credited with the par or stated value and Paid-in Capital in Excess of Par is credited with the remaining amount.

Yanıt Açıklaması: The term “estimated liabilities” is defined as the present obligations with uncertain amounts to settle. That amount is the best estimate of the amount that an entity would rationally pay to settle the obligation at the balance sheet date. The correct answer is B.

Yanıt Açıklaması: Book value per share ratio is used to calculate the per share value of a corporation. In other words, it represents the amount of the owner’s equity on the corporation’s books for each common share. The correct answer is A.

Yanıt Açıklaması: The preferred dividend = Outstanding preferred shares x Par value x Preferred dividend rate 50,000 x 30 x 10% = 150,000 TL

Yanıt Açıklaması: Double taxation is a disadvantage of a corporation but others are advantages.

Yanıt Açıklaması: Partnership is an entity owned by two or more owners.

Yanıt Açıklaması: Bonds issued in the name of the owner are called “registered bonds” and require surrender of the certificate and issuance of a new certificate to complete a sale.

Yanıt Açıklaması: Proprietorship is an entity owned by a single owner.

Yanıt Açıklaması: • Trading securities are debt or equity securities bought and held principally for the purpose of being sold in the near term to generate income on short-term price differences. • Available-for-sale securities are debt or equity securities that do not meet the criteria for either trading or held-to-maturity securities. They are held with the intent of selling them sometime in the future. Therefore, they may be short-term or long-term depending on what management intends to do with them. • Held-to-maturity securities are debt securities that the investor has an intend and ability to hold until their maturity date. The correct answer is D.

Yanıt Açıklaması: Return on Equity is a measure of a corporation’s profitability that presents how much profit it generates with each item (TL) of shareholders’ equity. The correct answer is E.

Yanıt Açıklaması: Amortization Amount = Bond Interest Expense – Bond Interest Paid