Which of the Following Is False Regarding the Issue of Stock

question 140

Multiple Choice

Which of the following is false regarding the issue of stock versus the issue of bonds to raise capital?

• A)The payment of dividends is at the discretion of the board of directors.
• B)The payment of interest on bonds payable is required by law.
• C)Interest accrues,whereas dividends do not accrue.
• D)The declaration of dividends reduces the amount of income taxes the corporation must pay.

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Definitions:

Actual Authority

The express or implied legal power granted by a principal to an agent to carry out specific tasks on the principal's behalf.

Real Estate Broker

A licensed individual or firm that acts as an intermediary between sellers and buyers of real estate.

Contract Sale

An agreement between a buyer and a seller where the payment for goods or services is extended over a period, often related to real estate transactions.

Unidentified Principal

A party in a transaction whose identity is not disclosed or known to the other parties involved.