Which of the Following Would Immediately Cause a Change in a Corporation's

question 30

Multiple Choice

Which of the following would immediately cause a change in a corporation's retained earnings?

• A)Net income or net loss and declaration of dividends.
• B)Declaration of dividends and issuance of common stock to new stockholders.
• C)Net income and issuance of stock to new stockholders.
• D)Declaration of dividends and purchase of new machinery.

Understand and apply the principles of budget preparation, including sales, production, and direct labor budgets.

Calculate production needs based on sales projections and inventory policies.

Identify the components of a master budget and their interrelationships.

Analyze the impact of inventory policies on budgeting (both finished goods and raw materials).

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Definitions:

Preferred Stock

A type of equity security that has a higher claim on a company's assets and earnings than common stock, often paying fixed dividends.

Treasury Stock

Shares of a company's own stock that it has reacquired and held in its treasury.

Cumulative

Referring to the total amount accumulated over time, often used to describe interest, dividends, or other quantities that increase over periods.

Preferred Stock

Preferred stock is a type of stock that gives its holders priority over common stockholders in terms of dividend payouts and claims on assets in the event of a liquidation.