Smith Corp

question 104

Multiple Choice

Smith Corp. has both Class A and Class B shares of common stock. The difference between the two classes of stock is most likely related to

• A) Class A stock being worth more than Class B stock.
• B) Class A shareholders having greater voting rights than Class B shareholders.
• C) Class A shareholders receiving dividends while Class B shareholders do not.
• D) Class A shareholders having better preemptive rights than Class B shareholders.

---

Definitions:

Finished Goods

Items that are fully manufactured but remain unsold and undistributed to the final consumer.

Raw Materials

The basic materials from which products are made, used at the start of the production process.

Requisitioned

The process of formally requesting or acquiring goods or services needed for business operations or production.

Direct Labor

The wages and related benefits for employees directly involved in the production of goods or services, considered a variable cost as it typically changes with production levels.