Which of the Following Is NOT a Valid Reason for a Stock

question 17

Multiple Choice

Which of the following is NOT a valid reason for a stock split?

• A) to increase the shareholder base by increasing the number of shares outstanding and making them more marketable
• B) to reduce the market price of the shares so that more individuals can afford to invest in the shares
• C) to increase the market price of the shares to make the stock more attractive
• D) to reduce the market price of the shares to make the stock more attractive

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Definitions:

Plantwide Predetermined

A method that assigns overhead costs to products based on a single predetermined overhead rate for the entire factory or plant.

Manufacturing Overhead

Refers to all the indirect costs associated with the production process, excluding direct materials and direct labor costs.

Machine-Hours

A unit of measure reflecting the amount of time a machine is operated.

Plantwide Predetermined

The determination of a single overhead rate that is applied throughout an entire plant or facility, irrespective of individual processes.