ACC 231 - ASU Final Exam (Exam 3)
Question and answers verified to pass
2025/2026
Issuance of Shares - correct answer ✔Journalization:
Proceeds for employee stock plans (Dr.)
Payments of long-term debt and finance lease obligations(Cr.)
Payments of cash dividends(Cr.)
Repurchase of common stock(Cr.)
Other(net) (Cr.)
Calculation of total paid in capital - correct answer ✔Par value + additional paid-in capital
or
Stockholder's equity-retained earnings + treasury stock
Calculation of earnings per share - correct answer ✔net income of the company/avg outstanding
shares of the company
or
net income-dividend to shareholders/avg outstanding shares of the company
*no impact on acc equation
Dividends - correct answer ✔declaration date (create liability)
date of record (no entry needed)
date of payment(extinguishment of liability)
Impact on acc equation (subtract dividends from retained earnings)
, Stock dividends - correct answer ✔(large stock dividends are issued at par value and small stock
dividends are issued at market price of the share) - there is no overall impact on ACC equation.
Operating cash flows - correct answer ✔Profit (Dr.)
Adjustment to net income (Dr.)
Depreciation(Dr.)
Amortization(Dr.)
Gain on sale of equipment(Cr)
Loss on sale of equipment(Dr.)
Increase in inventory(Cr.)
Decrease in receivables(Dr.)
Decrease in payable(Cr.)
Increase in deferred revenue(Dr.)
Investing cash flows - correct answer ✔Investments(Cr.)
Proceeds from sale of equipment(Dr.)
Other cash flow from investing activities(Dr.)
Financing cash flows - correct answer ✔Stock issuance(Dr.)
Increase in debt(Dr.)
Dividends paid(Cr.)
Liquidity ratios - correct answer ✔Liquidity refers to both an enterprise's ability to pay short-term bills
and debts and a company's capability to sell assets quickly to raise cash.
Question and answers verified to pass
2025/2026
Issuance of Shares - correct answer ✔Journalization:
Proceeds for employee stock plans (Dr.)
Payments of long-term debt and finance lease obligations(Cr.)
Payments of cash dividends(Cr.)
Repurchase of common stock(Cr.)
Other(net) (Cr.)
Calculation of total paid in capital - correct answer ✔Par value + additional paid-in capital
or
Stockholder's equity-retained earnings + treasury stock
Calculation of earnings per share - correct answer ✔net income of the company/avg outstanding
shares of the company
or
net income-dividend to shareholders/avg outstanding shares of the company
*no impact on acc equation
Dividends - correct answer ✔declaration date (create liability)
date of record (no entry needed)
date of payment(extinguishment of liability)
Impact on acc equation (subtract dividends from retained earnings)
, Stock dividends - correct answer ✔(large stock dividends are issued at par value and small stock
dividends are issued at market price of the share) - there is no overall impact on ACC equation.
Operating cash flows - correct answer ✔Profit (Dr.)
Adjustment to net income (Dr.)
Depreciation(Dr.)
Amortization(Dr.)
Gain on sale of equipment(Cr)
Loss on sale of equipment(Dr.)
Increase in inventory(Cr.)
Decrease in receivables(Dr.)
Decrease in payable(Cr.)
Increase in deferred revenue(Dr.)
Investing cash flows - correct answer ✔Investments(Cr.)
Proceeds from sale of equipment(Dr.)
Other cash flow from investing activities(Dr.)
Financing cash flows - correct answer ✔Stock issuance(Dr.)
Increase in debt(Dr.)
Dividends paid(Cr.)
Liquidity ratios - correct answer ✔Liquidity refers to both an enterprise's ability to pay short-term bills
and debts and a company's capability to sell assets quickly to raise cash.
