When No-Par Value Shares Do Not Have a Stated Value

question 294

True/False

When no-par value shares do not have a stated value, the entire proceeds from the issuance of the shares becomes legal capital.

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Definitions:

Net Present Value

The gap between what cash inflows and cash outflows are worth now, calculated over a specified period.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term liquidity.

Incremental Cost Approach

A decision-making process focusing on the additional costs and benefits associated with a particular business decision.

Incremental Cost Approach

The method of analyzing the financial information needed for decision making by considering only the costs and benefits that change due to the decision.