Which of the Following Is Not a Reason for Distributing

question 48

Multiple Choice

Which of the following is not a reason for distributing equity among employees?

• A) New companies often can't pay market rates for salary and wages
• B) Including some equity in the compensation package aligns the employee with the company
• C) The sense of ownership boosts morale
• D) Distributing equity among employees reduces the risk of hostile takeover
• E) Having some equity, the team sticks together during the rough times in the early launch phase

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Definitions:

Gain on Sale

The profit realized from the sale of assets that exceeds the book value of those assets.

Other Comprehensive Income

Income that is not included in net income, including items that are not realized, such as foreign currency translation adjustments and unrealized gains or losses on investments.

Current Period Profit or Loss

The net income or loss for the current reporting period, reflecting the financial performance of an entity over that timeframe.

Gain or Loss

Financial terms indicating the positive or negative financial result of transactions or events affecting the company's assets, liabilities, or equity.