The Process for Issuing Shares Is That

question 31

Multiple Choice

The process for issuing shares is that:

• A) They are offered for sale, allotments are received and an assignment made. Monies received on allotment must be held in trust until the assignment is made.
• B) They are offered for sale, applications are received and an allotment made. Monies received on application must be held in trust until the allotment is made.
• C) Applications are received for the issue of shares and an offer of shares is made. Applicants contribute capital that is returned to them if their application is unsuccessful when the shares are assigned.
• D) A notice of intention to purchase shares is registered with the stock exchange, which the company receives. The company then offers shares. The applicant may then be allotted shares and at that point must make the cash contribution.
• E) None of the given answers.

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Definitions:

Bonds

Long-term debt securities issued by governments or corporations to finance their operations, offering periodic interest payments to investors.

Interest

The charge for borrowed money, usually expressed as a percentage of the amount borrowed annually.

Economic Loss

Occurs when the cost of producing a good or service exceeds the revenue gained from selling it.

Investment Return

The profit or loss derived from investing capital, including dividends, capital gains, and interest.