A(n)__________ Is the First Time That a Company Sells Its

question 63

Multiple Choice

A(n) __________ is the first time that a company sells its stock to the public.

• A) stock exchange
• B) initial public offering
• C) private exchange
• D) stock auction

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Definitions:

Depreciation Tax Shield

A tax reduction achieved through deducting depreciation expenses, lowering taxable income.

Straight-Line Method

A method of calculating depreciation of an asset, which assumes the asset will lose an equal amount of value each year over its useful life.

CCA Rate

The Capital Cost Allowance rate, which is used for tax purposes to determine the yearly depreciation expense that can be claimed on tangible and intangible assets.

Depreciation Tax Shield

The reduction in income tax expense realized by depreciating fixed assets for tax purposes.