Which of the Following Statements Is True

question 17

Multiple Choice

Which of the following statements is true?

• A) Common shares have a dividend rate fixed by the share contract.
• B) Preferred shares have a volatile market value therefore, they are a riskier investment than common shares.
• C) Corporations are not always considered to be a separate legal entity.
• D) Transfer of ownership is easy with a corporation.

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Definitions:

Budgeted Sales

Forecasted sales revenue a company expects to earn in a specific period, based on historical data, market analysis, and economic trends.

Raw Material Purchases

The total cost of raw materials bought by a company for use in production over a specific period.

Cash Out

The act of disbursing or spending cash, typically resulting in a decrease in the cash balance of a business or individual.

Raw Materials

The basic materials that are used in the production process of goods, prior to being processed or transformed.