ACC 201 Week 5 Chapter 8 Quiz Guide Questions and Answers: Ashford University

1. Describe how corporations finance their operations and its impact on earnings per share. Problem #1 - Correct A _____ is a form of an interest-bearing note requiring periodic interest payments with the face amount due at the maturity date. ve t note debt Feedback Correct. A bond is a form of an interest-bearing note requiring periodic interest payments with the face amount due at the maturity date. Problem #2 - Correct Based on the following information, calculate the earnings per share of common stock. Net income $27,000 Preferred dividends $3,000 Number of common shares outstanding 12,000 a.$1.11 b.$2.00 c.$1.30 d.$2.25 Feedback Correct. Earnings per share = (Net income – Preferred dividends) ÷ Number of common shares outstanding = ($27,000 − $3,000) ÷ 12,000 shares = $2.00 Problem #9 - Correct Which of the following is an example of equity? a.Common stock b.A contingent liability c.Deferred tax d.Commercial paper