An Entity's Liabilities Come from Three Primary Sources: Creditors, Investors

question 78

True/False

An entity's liabilities come from three primary sources: creditors, investors, and profits retained in the business.

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Definitions:

Outstanding Common Stock

Outstanding common stock refers to the total number of shares of a corporation's stock that are currently owned by all its shareholders, including shares held by institutional investors and restricted shares.

Unrecorded Patents

Patents that an organization owns which have not been recorded in its financial statements.

Dividends

Payments made by a corporation to its shareholder members, usually derived from profits.

Outstanding Voting Common Stock

The shares of a company held by shareholders that are entitled to vote and are not held by the company itself.