Explain Why Most Corporations Issue Pre-Emptive Rights on Their New

question 47

Essay

Explain why most corporations issue pre-emptive rights on their new issues of stock when pre-emptive rights are generally not recognized by courts in Canada.

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Definitions:

LIFO Method

A method of inventory valuation based on the assumption that the most recently acquired items are the first to be sold.

Cost Of Goods Sold

Expenses inherently linked to the manufacturing of a company's products, including the costs of materials and labor.

Finished Goods

Items that have gone through the production process and are now prepared for sale.

Manufacturer

A company or person that produces finished goods from raw materials in large quantities through various processes.