Howard Thought He Had His Expense Control Problems Resolved When

question 98

Multiple Choice

Howard thought he had his expense control problems resolved when he decided he would hire sales clerks from the local high school and pay them minimum wage. Which of the following statements is most likely to be true of Howard's decision?

• A) No one works for minimum wage
• B) It is a good move because of the decreasing workforce
• C) He will probably have higher turnover, absenteeism and poor labour productivity
• D) Since high school students are inexperienced, it is justified to pay minimum wage
• E) Young energetic enthusiasm will help Howard's sales

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Definitions:

Reacquired Shares

Stocks that were issued and subsequently bought back by the issuing company, reducing the number of shares outstanding on the open market.

Common Stock

Equity ownership in a corporation, representing a claim on part of the corporation's earnings and assets.

Journalize Transactions

The process of recording business transactions in the journal as part of the accounting cycle.

Stock Split

An action by a company to increase the number of its outstanding shares by issuing more shares to current shareholders, thus reducing the price per share without changing the company’s market capitalization.