Drilling Tools,Inc

question 45

Multiple Choice

Drilling Tools,Inc.,wants to make an initial public offering of securities. Drilling Tools believes that it qualifies for an exemption under Regulation A from the full registration requirement of the federal Securities Act of 1933.
-Drilling Tools decides to sell its new securities via the Internet. This offering

• A)will avoid the payment of commissions to brokers or underwriters.
• B)is an investment scam.
• C)is a Ponzi scheme.
• D)constitutes insider trading.

---

Definitions:

Administrative Expenses

Costs associated with the general management of a business, such as salaries of senior executives, legal and financial charges, marketing, and office supplies.

Direct Materials

Materials that can be directly linked to the manufacturing of particular products or services.

Units Sold

The total quantity of products or services sold within a specific period, often used to measure business performance.

Direct Labor

The labor costs directly tied to the production of goods or the provision of services.