Provide an Appropriate Response

question 10

Essay

Provide an appropriate response.
-Give two reasons why a business would prefer to calculate stock turnover at retail rather
than at cost.

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Definitions:

Preferred Stock

A class of ownership in a corporation with a specified dividend that is paid before any dividends are paid to common stock holders and typically with no voting rights.

Common Stock

Type of security that signifies ownership in a corporation and represents a claim on part of the company's profits and assets.

Dividends

Disbursements issued by a company to its shareholders, representing a share of the company's earnings distributed to its stockholders.

Cash Dividend

A cash dividend refers to the distribution of a portion of a company's profits to its shareholders as cash.