A Premium on Common Stock

question 113

Multiple Choice

A premium on common stock:

• A)Occurs when a corporation sells its stock for more than par or stated value.
• B)Is the difference between par value and issue price when the amount paid is below par.
• C)Represents profit from issuing stock.
• D)Represents capital gain on sale of stock.
• E)Is prohibited in most states.

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Definitions:

Pineal Body

A small endocrine gland in the vertebrate brain, secreting the hormone melatonin, which regulates sleep patterns.

Pituitary

A small, pea-sized gland located at the base of the brain, responsible for controlling growth, metabolism, and reproductive functions.

Thymus

An unpaired organ located in the mediastinal cavity anterior to and above the heart.

Adrenal

Pertaining to adrenal glands, which are small glands located above the kidneys that produce hormones like adrenaline and cortisol.