Indicate whether each of the following transactions increases (+), decreases (−), or has no effect (NE) on total assets, total liabilities, and total stockholders’ equity. The first transaction is completed as an example. Transaction TotalAssets TotalLiabilities TotalStockholders’ Equity Issue common stock + NE + Issue preferred stock       Purchase treasury stock       Resell treasury stock

Cumulative preferred stock gives its owners a right to be paid both the current and all prior periods' unpaid dividends before any paid to common stockholders. True or False True False

a. Issued ________shares of common stock. Stock has par value of ___ per share and was issued at $____per share. (please refer to table below and use only the info in line with the initial "E" in theblank/underlined space) b. Issued _______ shares of preferred stock at par value as payment in exchange for legal services. (pleaserefer to table below and use only the info in line with the initial "E" in the blank/underlinedspace)

Match (by letter) the following terms with their definitions. Each letter is used only once.Terms_____ 1. Cumulative._____ 2. Retained earnings._____ 3. Outstanding stock._____ 4. Limited liability._____ 5. Treasury stock._____ 6. Issued stock._____ 7. Angel investors._____ 8. Paid-in capital._____ 9. Authorized stock._____ 10. Redeemable.Definitionsa. The amount invested by stockholders.b. Shares available to sell.c. Shares can be returned to the corporation at a predetermined price.d. The earnings not paid out in dividends.e. Shares actually sold.f. Shares receive priority for future dividends if dividends are not paid in a given year.g. Shares held by investors.h. Shareholders can lose no more than the amount they invested in the company.i. Wealthy individuals in the business community willing to risk investment funds on a promising business venture.j. The corporation’s own stock that it acquired.

If the owner of 200 shares sells his or her stock, the trade is said to have occcured in the _market. Select one: O a. Secondary O b. IPO O . Equity O d. Primary

1. The total dividends to be given to preferred stock, if preferred stock is cumulative and fully participating, would be: 2. The total dividends to be given to common stock, if preferred stock is cumulative and fully participating, would be:        3. The total dividends to be given to preferred stock, if preferred stock is non-cumulative and fully participating, would be:

Which of the following decreases total equity? A. A stock split B. Recording Revenue C. The purchase of Treasury Stock D. Issuance of Convertible preferred stock

4.  Define the following terms. Signaling hypothesis; clientele effect Residual distribution model; extra dividend Declaration date; holder-of-record date; ex-dividend date; payment date Dividend reinvestment plan (DRIP) Stock split; stock dividend; stock repurchase

The value of preferred stock is based on earnings per share.  Select one: True False