Beta Corporation Is About to Be Wound Up

question 35

True/False

Beta Corporation is about to be wound up. The Corporation has cash assets of $1.5 million, liabilities of $1.1 million, 50 000 preferred shares with a fixed 10% dividend, and 50 000 common shares. Sufficient information is present to determine the value of the common share on winding up.

---

Definitions:

Dividends Payable

represents a company's obligation to pay its shareholders a declared amount from its earnings.

Liability

A financial obligation or amount owed by a business or individual to others, which must be settled in the future.

Goodwill

An intangible asset that arises when a business is purchased for more than the fair value of its net identifiable assets.

Acquisition

The process by which a company purchases most or all of another company's shares or assets, in order to take control or ownership of that company.