FIN. ACCT.-TOOLS FOR BUS.DEC.MAKING-CODE
9th Edition
ISBN: 9781119595724
Author: Kimmel
Publisher: WILEY C
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Chapter 11, Problem 19Q
To determine
Stock Dividends: It refers to the payment of the dividend to its shareholders by the corporation in the form of shares rather than cash is referred as stock dividend.
Stock Splits: It is a method of increasing the total number of outstanding shares thereby, reducing the market price of each share, however, keeping the corporation’s total market value constant.
To explain: the differences in effects of stock dividend and stock split on different aspects of
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A stockholder dissatisfied with the management of the corporation done by the Board of Directors surrenders his certificate of stocks and demands the return of the subscription price paid by him. Can he rightfully do this? Explain.
Which of the following statements is NOT correct about the rights granted to common stockholders?
Group of answer choices
a. Stockholders may transfer their right to vote to a second party by means of a proxy.
b. Dividends due to common stockholders are cumulative.
c. Common stockholders have the right to elect a firm's directors.
d. In large, publicly traded firms, managers typically have some stock but their personal holdings are generally insufficient to win voting control.
What are some actions stockholders can take to ensure that management’s interests and the interests of stockholders coincide? What are some other factors that influence management’s actions?
Chapter 11 Solutions
FIN. ACCT.-TOOLS FOR BUS.DEC.MAKING-CODE
Ch. 11 - Prob. 1QCh. 11 - Prob. 2QCh. 11 - Prob. 3QCh. 11 - Prob. 4QCh. 11 - Prob. 5QCh. 11 - Prob. 6QCh. 11 - Prob. 7QCh. 11 - Which is the boiler investmentcommon stock with a...Ch. 11 - Prob. 9QCh. 11 - Prob. 10Q
Ch. 11 - Prob. 11QCh. 11 - Prob. 12QCh. 11 - Indicate how each of these accounts should be...Ch. 11 - What three conditions must be met before a cash...Ch. 11 - Prob. 15QCh. 11 - Prob. 16QCh. 11 - Prob. 17QCh. 11 - Prob. 18QCh. 11 - Prob. 19QCh. 11 - Prob. 21QCh. 11 - Prob. 22QCh. 11 - Prob. 23QCh. 11 - Prob. 24QCh. 11 - Prob. 25QCh. 11 - Prob. 26QCh. 11 - Prob. 11.1BECh. 11 - Prob. 11.2BECh. 11 - Prob. 11.3BECh. 11 - Prob. 11.4BECh. 11 - Prob. 11.6BECh. 11 - Prob. 11.8BECh. 11 - Prob. 11.9BECh. 11 - Prob. 11.10BECh. 11 - Prob. 11.11BECh. 11 - Prob. 11.12BECh. 11 - Prob. 11.13BECh. 11 - Prob. 11.14BECh. 11 - Prob. 11.1aDIECh. 11 - Prob. 11.2aDIECh. 11 - Prob. 11.2bDIECh. 11 - Prob. 11.3aDIECh. 11 - Prob. 11.3bDIECh. 11 - Prob. 11.4aDIECh. 11 - Prob. 11.3ECh. 11 - Prob. 11.4ECh. 11 - Prob. 11.6ECh. 11 - Prob. 11.7ECh. 11 - Prob. 11.8ECh. 11 - Prob. 11.9ECh. 11 - Prob. 11.11ECh. 11 - Prob. 11.19ECh. 11 - Prob. 11.3EYCTCh. 11 - Prob. 11.4EYCTCh. 11 - DECISION MAKING ACROSS THE ORGANIZATION During a...Ch. 11 - Prob. 11.7EYCTCh. 11 - Prob. 11.8EYCTCh. 11 - Prob. 11.9EYCTCh. 11 - Prob. 11.12EYCTCh. 11 - Prob. 11.1IECh. 11 - Prob. 11.2IECh. 11 - Prob. 11.3IE
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- 16. Which of the following statements is NOT correct about the rights granted to common stockholders? a. Stockholders may transfer their right to vote to a second party by means of a proxy. b. Dividends due to common stockholders are cumulative. c. Common stockholders have the right to elect a firm's directors. d. In large, publicly traded firms, managers typically have some stock but their personal holdings are generally insufficient to win voting control.arrow_forwardWhich one of the following statements apply only to preference shareholders and not to equity shareholders a. Shareholders risk the loss of investment b. Shareholders bear the risk of no dividends in the event of losses c. Shareholders usually have the right to vote d. Dividends are usually given at a set amount in every financial yeararrow_forwardWhich of the following statements related to dividends is incorrect? O Dividends must be paid in the period declared. O Before declaring a dividend, management must consider availability of funds to pay the dividend. O Distributions to owners must be in compliance with the state laws. O Dividends must be declared by the Board of Directors.arrow_forward
- Which of the following is NOT a characteristic of an ordinary share? a) The dividends are at the discretion of directors b) They give voting rights at meetings c) They are irredeemable d) Interest is accrued if the dividend is not paidarrow_forwardThe dividend is not a legal liability until the board of directors has declared it. true or false. Explain why?arrow_forwardWhich feature is not applicable to common stock ownership?a. Right to receive dividends before preferred stockshareholders.b. Right to vote on appointment of external auditor.c. Right to receive residual assets of the company shouldit cease operations.d. All of the above are applicable to common stockownership.arrow_forward
- Which of the following would NOT be a right of a common stockholder? 1. Receive interest income on stock. 2. Vote at stockholders’ meetings. 3. Receive dividends, if any. 4. Sell stock.arrow_forwardWhich of the following statements are true regarding corporations? Note: You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect. ✔The sale of shares from one stockholder to another does not impact operations. An exception is when it changes the makeup of directors. ? It has many of the same rights as an individual. ?Stockholders do not have the power to bind the corporation to contracts. ? Stockholders are expected to hire and fire key executives. ? Owners are personally liable for corporate debts. ? It is a separate legal entity. ? Owners are not agents of the corporation.arrow_forwardWhich of the following represents one of the basic rights of stockholders? a. Stockholders may sell their stock back to the company if they wish. b. Stockholders may authorize a business contract on behalf of the corporation. c. Stockholders may determine at what price the company issues stock. d. Stockholders may participate in management by voting on corporate matters.arrow_forward
- Answer the follow: Explain the corporate characteristic termed “no mutual agency" Explain the corporate characteristic termed limited liability. Explain the term outstanding stock. Is it true or false that corporations muse issue common stock, but may or may not decide to issue preferred stock? Is it true or false that all forms and classes of stock carry voting rights? Is it true of false that stock sold for amounts in excess of par value results in a gain reported on the income statement?arrow_forwardThe directors of Merchant Corporation are considering the issuance of a stock dividend. They have asked you to discuss the proposed action by answering the following questions. Instructions a. What is a stock dividend? How is a stock dividend distinguished from a stock split (1) from a legal standpoint, and (2) from an accounting standpoint? b. For what reasons does a corporation usually declare a stock dividend? A stock split? c. Discuss the amount, if any, of retained earnings to be capitalized in connection with a stock dividend.arrow_forwardFor each of the following characteristics of governance, use the table to indicate whether more or less trading activity in the stock market is likely to result. Characteristics weaker rights of shareholders weaker legal protection for shareholders more corporate corruption more uniform accounting laws More Trading Activity Less Trading Activityarrow_forward
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