Which of the Following Statements Is Most Correct

question 15

Multiple Choice

Which of the following statements is most correct?

• A) One of the advantages to the firm associated with financing using preferred stock rather than common stock is that control of the firm is not diluted.
• B) Preferred stock provides steadier and more reliable income to investors than common stock.
• C) One of the advantages to the firm of financing with preferred stock is that 70 percent of the dividends paid out are tax deductible.
• D) Statements a and c are correct.
• E) Statements a and b are correct.

Recognize valid contract assignments and the role of assignees.

Distinguish between oral and written contracts and understand their enforceability.

Explain the significance of the Uniform Commercial Code (UCC) in relation to contract requirements.

Identify and explain exceptions to the statute of frauds.

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Definitions:

Dividends

Dividends are a portion of a company's earnings that are distributed to shareholders as a reward for their investment in the company.

Net Income

The total earnings of a company after deducting all expenses, taxes, and losses, representing the profit for the period.

Income Statement

A financial document detailing a company's revenue, expenses, and profit over a specific period.

Expenses

The costs incurred in the operation of a business or the execution of a specific project.