Corporation Part2

1. Property dividends should be recorded using the carrying value of the assets as of the declaration date.

• True
• False

2. A share capital dividend decreases Retained Earnings and increases Contributed Capital.

• True
• False

3. A share capital dividend does not change Total Shareholder’s Equity.

• True
• False

4. A debit balance in the Retained Earnings account is called a deficit.

• True
• False

5. A share capital dividend that has been declared but not yet distributed should be reported as current liability.

• True
• False

6. An appropriation of Retained Earnings reduces the total amount of Retained Earnings.

• True
• False

7. The accounting cycle of a corporation is very much different from the accounting cycle of a partnership or a sole proprietorship.

• True
• False

8. Dividends may be declared even if a corporation has a deficit.

• True
• False

9. Unappropriated Retained Earnings represents the amount of cash available for dividend distribution.

• True
• False

10. Appropriation of Retained Earnings is necessary when the corporation reacquires its own share capital.

• True
• False