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Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
2) Corporations avoid many of the state regulations and controls that proprietorships and
partnerships are subject to.
Answer: FALSE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
3) Organization expenses of a corporation often include legal fees and promoter fees.
Answer: TRUE
Difficulty: 2 Medium
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
Answer: FALSE
Difficulty: 2 Medium
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making
1
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
5) A proxy is a document that gives a designated agent the right to vote a shareholder's stock.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making
6) Common shareholders always share equally with all other shareholders (including preferred
shareholders) in dividends.
Answer: FALSE
Difficulty: 2 Medium
Topic: Issuance of Preferred Stock
Learning Objective: 11-C2 Explain characteristics of, and distribute dividends between,
common and preferred stock.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Measurement
7) A preemptive right means shareholders can purchase their proportional share of common
stock issued later by the corporation.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making
8) Stock is attractive to investors because stockholders are not liable for the corporation's actions
and debts and because stock is easily transferred.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Decision Making
2
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
9) A registrar keeps stockholder records for dividend payments and stockholder meetings.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
11) The price at which a share of stock is bought or sold is known as par value.
Answer: FALSE
Difficulty: 2 Medium
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Measurement
12) Paid-in capital is the total amount of cash and other assets the corporation receives from its
stockholders in exchange for its stock.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Measurement
3
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
13) The total number of shares outstanding is always equal to the number of shares authorized.
Answer: FALSE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Measurement
14) If a corporation is authorized to issue 1,000 shares of $5 common stock, it is said to have
$5,000 of common stock outstanding.
Answer: FALSE
Difficulty: 2 Medium
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
15) Minimum legal capital is the least amount that the buyers of stock must contribute to the
corporation or be at risk to pay creditors at a future date.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
16) Stated value stock is no-par stock that is assigned a "stated" value per share.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
4
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
17) A corporation may be authorized to issue both common and preferred stock.
Answer: TRUE
Difficulty: 1 Easy
Topic: Characteristics of Corporations
Learning Objective: 11-C1 Identify characteristics of corporations and their organization.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
18) Common stock always carries a preference for receiving dividends over preferred stock.
Answer: FALSE
Difficulty: 2 Medium
Topic: Issuance of Preferred Stock
Learning Objective: 11-C2 Explain characteristics of, and distribute dividends between,
common and preferred stock.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
19) A special right often granted to preferred stock is additional voting privileges.
Answer: FALSE
Difficulty: 1 Easy
Topic: Issuance of Preferred Stock
Learning Objective: 11-C2 Explain characteristics of, and distribute dividends between,
common and preferred stock.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Measurement
20) Cumulative preferred stock carries the right to be paid both current and all prior periods'
unpaid dividends before any dividends are paid to common shareholders.
Answer: TRUE
Difficulty: 1 Easy
Topic: Issuance of Preferred Stock
Learning Objective: 11-C2 Explain characteristics of, and distribute dividends between,
common and preferred stock.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Measurement
5
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
21) Retained earnings generally consists of a company's cumulative net income less any net
losses and dividends declared.
Answer: TRUE
Difficulty: 1 Easy
Topic: Statement of Retained Earnings
Learning Objective: 11-C3 Explain the items reported in retained earnings.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
22) Retained earnings are part of the stockholders' claims on the company's net assets.
Answer: TRUE
Difficulty: 2 Medium
Topic: Statement of Retained Earnings
Learning Objective: 11-C3 Explain the items reported in retained earnings.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
23) The term restricted retained earnings refers to statutory but not contractual restrictions.
Answer: FALSE
Difficulty: 1 Easy
Topic: Statement of Retained Earnings
Learning Objective: 11-C3 Explain the items reported in retained earnings.
Bloom's: Remember
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Industry; FN Reporting
24) A common statutory restriction is reported on the income statement; whereas a common
contractual restriction is reported in the stockholders' equity section of the balance sheet.
Answer: FALSE
Difficulty: 2 Medium
Topic: Statement of Retained Earnings
Learning Objective: 11-C3 Explain the items reported in retained earnings.
Bloom's: Understand
AACSB/Accessibility: Communication / Keyboard Navigation
AICPA: BB Legal; FN Reporting
6
Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
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APÉNDICES
I
(DE LA «MONJA-ALFÉREZ», DE MONTALBÁN.)
II.
(DE «LA MONJA ALFÉREZ», DE CARLOS COELLO).
APÉNDICES
Proposición de la Alcaldía para trasladar los restos de Pizarro.
«Considerando: Que es de dignidad nacional dar honrosa
sepultura á los restos del conquistador del Perú, que hoy se
encuentran en la bóveda de la Iglesia Catedral,
«Propone: Que se autorice á la Alcaldía para que solicite del Ilmo.
y Rmo. Sr. Arzobispo y del Cabildo metropolitano la licencia
correspondiente para colocar los restos del Capitán general D.
Francisco Pizarro en una de las capillas de la Iglesia Catedral,
quedando autorizada igualmente la Alcaldía para hacer construir
una urna donde reposen estos restos, hasta que la nación pueda
construir un monumento para tal objeto.
«Lima, Abril 30 de 1891.—Juan Revoredo.»
II
Discurso del Alcalde de Lima al entregar la urna que debía
guardar los despojos mortales de Pizarro.
«Excelentísimo Señor:
«Señor Ilustrísimo:
«Señores:
«Conmemoramos en este momento el aniversario del
fallecimiento del ilustre Capitán general D. Francisco Pizarro,
acaecido hace hoy trescientos cincuenta años.
«Nos encontramos en presencia de sus restos, de cuya
autenticidad no podemos dudar desde que la Historia así nos lo
demuestra y desde que las generaciones que se han venido
sucediendo nos los han ido haciendo conocer de padres á hijos
hasta llegar á nosotros.
«Don Francisco Pizarro fué el conquistador del Perú, el fundador
de esta capital, el que en sus propios hombros cargó el primer
madero que sirvió para la fabricación del templo en que nos
encontramos, y, lo que es más, fué el que nos legó la Religión que
profesamos, dándonos hasta su última hora pruebas del respeto y
de la veneración que tenía por ella; pues recordaréis que besando la
Cruz del Calvario, que con su propia sangre y puño había formado
para elevar sus preces al Todopoderoso, exhaló su último aliento.
Estamos obligados á creer, señores, que el alma del que así murió
tiene que estar gozando de las delicias del Paraíso.
«Toca á nosotros honrar sus inapreciables restos, que continuarán
bajo la custodia del Muy Ilustre Cabildo metropolitano.»
III