Question

28. Match (by number) the following terms with their definitions. Each letter is used only once. Statement of

1. A debit balance in retained earnings
2. Measures the ability of company management to generate earnings from the resources that owners provide

3. Effectively the same as a 2-for-1 stock split 4. The stock price divided by earnings per share
5. The corporation's own stock that it reacquired

6. Summarizes the changes in the balance in each stockholders' equity account over a period of time
7. Priced high in relation to current earnings as investors expect future earnings to be higher
8. Shows the balance in each equity account at a point in time
9. The earnings not paid out in dividends
10. Priced low in relation to current earnings

stockholders' equity. ____

Treasury stock. ____

Value stocks. ____

Retained earnings. ____

PE ratio. ____

Stockholders' equity section of the balance sheet. ____

Return on equity. ____

Growth stocks. ____

100% stock dividend. ____

Accumulated deficit. ____

Answer 1

1. A debit balance in retained earnings - Accumulated deficit.

2. Measures the ability of company management to generate earnings from the resources that owners provide - Return on equity.

3. Effectively the same as a 2-for-1 stock split - 100% stock dividend.

4. The stock price divided by earnings per share - PE ratio.

5. The corporation's own stock that it reacquired - Treasury stock.

6. Summarizes the changes in the balance in each stockholders' equity account over a period of time - stockholders' equity.

7. Priced high in relation to current earnings as investors expect future earnings to be higher - Growth stocks.

8. Shows the balance in each equity account at a point in time - Stockholders' equity section of the balance sheet

9. The earnings not paid out in dividends - Retained earnings.

10. Priced low in relation to current earnings - Value stocks