The ZYX Corporation Has a New Rights Offering, You Can

question 36

Multiple Choice

The ZYX Corporation has a new rights offering, you can buy one share of stock with 3 rights and $20 per share. The stock is now selling ex-rights for $26. The value of the right and the price rights-on are:

• A) $2.00, $22.00.
• B) $6.00, $28.00.
• C) $2.00, $28.00.
• D) $6.00, $32.00.

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Definitions:

Standard

A level of quality or achievement, especially one that is used as a point of reference.

Budget

An estimation of revenue and expenses over a specified future period of time, used by organizations for planning and controlling their financial resources.

Standard Cost

A predetermined cost of manufacturing, selling, or administering each product or service, used as a benchmark to measure performance.

Financial Statements

Reports that provide an overview of a company's financial condition in both short and long term, including balance sheet, income statement, and cash flow statement.