CGJ Company Has Provided the Following

question 97

Multiple Choice

CGJ Company has provided the following:
• 200,000 shares of $5 par value common stock are authorized
• 140,000 shares of common stock were issued for $11 per share
• 130,000 shares are outstanding
Which of the following statements is false?

• A)Common stock is reported at $700,000 on the balance sheet.
• B)Additional paid-in capital is reported at $840,000 on the balance sheet.
• C)Stockholders' equity decreased $110,000 when the treasury stock was purchased.
• D)There are 10,000 shares of treasury stock.

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Definitions:

Cost Of Merchandise

The purchase price of goods sold by a company, including the cost of acquiring the goods plus any additional expenses to bring them to saleable condition.

Freight In

The cost associated with transporting goods into a business, typically included in the cost of goods sold calculation.

Gross Profit

The financial gain obtained after subtracting the cost of goods sold from the revenue generated from sales.

Closing Entries

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent accounts, preparing the accounts for the next period.