Question 1

Corporations are obligated to pay cash dividends if they generate earnings.​

Accepted Answer

A) True 
 B)False

Question 2

Stock repurchases reduce​
1)  total equity
2)  total assets
3)  corporate taxes
4)  total liabilities

Accepted Answer

A)  ​1 and 2
B)  ​1 and 3
C)  ​2 and 3
D)  ​3 and 4

Question 3

​A stock split

Accepted Answer

A)   ​increases equity
B)   ​generates capital gains
C)   ​increases retained earnings
D)   ​does not affect liabilities

Question 4

Dividends come at the expense of

Accepted Answer

A)   ​interest
B)   ​retained earnings
C)   ​liabilities
D)   ​stock

Question 5

A cash dividend reduces a firm's equity.​

Accepted Answer

A) True 
 B)False  True

Question 6

A company may pay
1)  a regular quarterly cash dividend
2)  stock dividends
3)  no dividends​

Accepted Answer

A)  ​1 and 2
B)  ​1 and 3
C)  ​2 and 3
D)  ​1, 2, and 3

Question 7

A stock dividend has no impact on a firm's liabilities or the price of its stock.​

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is equity?
1)  investments
2)  additional paid‑in capital
3)  retained earnings

Accepted Answer

A)  ​1 and 2
B)  ​1 and 3
C)  ​2 and 3
D)  ​1, 2, and 3

Question 9

If a firm does not pay cash dividends, it may reinvest the earnings and grow.​

Accepted Answer

A) True 
 B)False

Question 10

Federal income taxes favor the retention of earnings over the distribution of earnings.​

Accepted Answer

A) True 
 B)False

Question 11

​Stock repurchases

Accepted Answer

A)   increase per share earnings
B)   ​decrease per share earnings
C)   ​increase liabilities
D)   ​decrease liabilities A

Question 12

Dividend reinvestment plans are​

Accepted Answer

A)   ​a convenient means to accumulate shares
B)   ​a means to defer federal income taxes on the dividends
C)   available only if the corporation distributes stock dividends
D)   ​more expensive than buying the stock through brokers A

Question 13

A stock dividend

Accepted Answer

A)   ​reduces the firm's cash
B)   ​increases the firm's total equity
C)   ​decreases the firm's stock price
D)   ​increases the firm's assets

Question 14

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.​

Accepted Answer

A) True 
 B)False

Question 15

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.​

Accepted Answer

A) True 
 B)False

Question 16

​Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the
stock?

Accepted Answer

The new balance sheet after the 5 percen...

Question 17

​Dividends are paid on the

Accepted Answer

A)   ​declaration date
B)   ​ex dividend date
C)   ​date of record
D)   ​distribution date

Question 18

Dividend reinvestment plans are a convenient means to encourage individuals to save.​

Accepted Answer

A) True 
 B)False

Question 19

Stock dividends increase the wealth of stockholders who receive additional shares. l> ​

Accepted Answer

A) True 
 B)False

Question 20

A 5% stock dividend reduces a firm's total equity.​

Accepted Answer

A) True 
 B)False

Exam 10: The Features of Stock

Corporations are obligated to pay cash dividends if they generate earnings.​

Correct AnswerverifiedShow Answer

Stock repurchases reduce​ 1) total equity 2) total assets 3) corporate taxes 4) total liabilities

Correct AnswerverifiedShow Answer

​A stock split

Correct AnswerverifiedShow Answer

Dividends come at the expense of

Correct AnswerverifiedShow Answer

A cash dividend reduces a firm's equity.​

Correct AnswerverifiedTrue

A company may pay 1) a regular quarterly cash dividend 2) stock dividends 3) no dividends​

Correct AnswerverifiedShow Answer

A stock dividend has no impact on a firm's liabilities or the price of its stock.​

Correct AnswerverifiedShow Answer

Which of the following is equity? 1) investments 2) additional paid‑in capital 3) retained earnings

Correct AnswerverifiedShow Answer

If a firm does not pay cash dividends, it may reinvest the earnings and grow.​

Correct AnswerverifiedShow Answer

Federal income taxes favor the retention of earnings over the distribution of earnings.​

Correct AnswerverifiedShow Answer

​Stock repurchases

Correct AnswerverifiedA

Dividend reinvestment plans are​

Correct AnswerverifiedA

A stock dividend

Correct AnswerverifiedShow Answer

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.​

Correct AnswerverifiedShow Answer

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.​

Correct AnswerverifiedShow Answer

​Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the stock?

Correct AnswerverifiedThe new balance sheet after the 5 percen...View AnswerShow Answer

​Dividends are paid on the

Correct AnswerverifiedShow Answer

Dividend reinvestment plans are a convenient means to encourage individuals to save.​

Correct AnswerverifiedShow Answer

Stock dividends increase the wealth of stockholders who receive additional shares. l> ​

Correct AnswerverifiedShow Answer

A 5% stock dividend reduces a firm's total equity.​

Correct AnswerverifiedShow Answer

Corporations are obligated to pay cash dividends if they generate earnings.

Correct Answer
verified

Stock repurchases reduce 1) total equity 2) total assets 3) corporate taxes 4) total liabilities

Correct Answer
verified

A stock split

Correct Answer
verified

Correct Answer
verified

A cash dividend reduces a firm's equity.

Correct Answer
verified
True

A company may pay 1) a regular quarterly cash dividend 2) stock dividends 3) no dividends

Correct Answer
verified

A stock dividend has no impact on a firm's liabilities or the price of its stock.

Correct Answer
verified

Correct Answer
verified

If a firm does not pay cash dividends, it may reinvest the earnings and grow.

Correct Answer
verified

Federal income taxes favor the retention of earnings over the distribution of earnings.

Correct Answer
verified

Stock repurchases

Correct Answer
verified
A

Dividend reinvestment plans are

Correct Answer
verified
A

Correct Answer
verified

If a stock is selling for $90 and is split 3 for 1, the new price of the stock should be $30.

Correct Answer
verified

Dividend reinvestment plans permit the stockholder to reinvest dividends as they are received.

Correct Answer
verified

Construct a new balance sheet showing the impact of a 5 percent stock dividend. What will be the new price of the stock?

Correct Answer
verified
The new balance sheet after the 5 percen...
View Answer

Dividends are paid on the

Correct Answer
verified

Dividend reinvestment plans are a convenient means to encourage individuals to save.

Correct Answer
verified

Stock dividends increase the wealth of stockholders who receive additional shares. l>

Correct Answer
verified

A 5% stock dividend reduces a firm's total equity.

Correct Answer
verified