b) The new shares which are issued in a rights issue are offered to the existing shareholders at discount. Explain why and what effect the discount has on the wealth of the individual shareholder
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- Which of the following can not be used for redemption of preference shares? A. Insurance Fund B. Workmen's Compensation Fund C. General Reserve D. Profit Prior to Incorporation4b) The new shares which are issued in a rights issue are offered to the existing shareholders at discount. Explain why and what effect the discount has on the wealth of the individual shareholder.The distribution of a dividend that represents a partial return of the original investment made by the shareholders is known as a. participating dividend. b. liquidating dividend. c. property dividend.
- Identify which category of shareholder's equity is affected by the item and briefly explain how it affected. 1. Purchase treasury shares (cost method)Which of the following statements is correct? Earnings and profits are exactly the same as retained earnings. Distributions paid in excess of earnings and profits are taxable to the extent of stockholder basis. Distributions of appreciated property create a gain to the stockholder recipient. A distribution from earnings and profits is a dividendWhat are dividends in arrears? How do they affect the allocation of dividends to preference and ordinary shareholder if: Preference share capital are noncumulative Preference share capital are cumulative
- Which of the following statements is correct? Multiple Choice Earnings and profits are exactly the same as retained earnings. Distributions of appreciated property create a gain to the stockholder recipient. A distribution from earnings and profits is a dividend. Distributions paid in excess of earnings and profits are taxable to the extent of stockholder basis.If an investor sells an ordinary share at a price above that which he or she originally paid, the investor is said to have earnedSelect one: a.a capital expenditure. b.a capital gain. c.an originating point. d.a dividend. explain well all point of question.When an individual owns directly stocks of the company, he has: Group of answer choices a. Direct Financial Interest b. Indirect Financial Interest c. Both Direct and Indirect d. Neither Direct nor Indirect
- Discuss the propriety of showing:(a) Treasury stock as an asset.(b) “Gain” or “loss” on sale of treasury stock as additionsto or deductions from income.(c) Dividends received on treasury stock as income.A dividend which is a return to stockholders of a portion of their original investments is a CHoices; property dividend. liquidating dividend. participating dividend. liability dividend.Matching Type. Choose the correct answer in the box provided. These are distributions of the earnings of the corporation in the form of the corporation's own shares. * It is the procedure of restating assets, liabilities and share capital balances at its fair value for the purpose of eliminating deficit. * Share option is the best example of this kind of share-based compensation plan. * The date the liability for dividends must be recognized *
