Multiple choice

1. The most appropriate basis for dividing partnership net income when the partners do not plan to take an active role in daily operations is

 salaries to the partners and the remainder on a fixed ratio.

 interest on capital balances and salaries to the partners.

 on a ratio based average capital balances.

 on a fixed ratio.

2. The following data is available for BOX Corporation at December 31, 2010: 

Common stock, par $10 (authorized 15,000 shares)$100,000

Treasury Stock (at cost $15 per share)600

Based on the data, how many shares of common stock are outstanding?

 15,000

 10,000

 14,960

 9,960

3. When stock is issued for legal services, the transaction is recorded by debiting Organization Expense for the 

stated value of the stock. 

book value of the stock. 

market value of the stock. 

par value of the stock.

4. The two ways that a corporation can be classified by ownership are

 publicly held and privately held. 

majority and minority. 

stock and non-stock. 

inside and outside.