Klingon Corporation Has Only One Class of Shares,its Common Shares

question 75

Multiple Choice

Klingon Corporation has only one class of shares,its common shares.Klingon has assets of $200,000 and liabilities of $160,000.It has $40,000 of excess liquidity that it does not need to pay its currently maturing obligations.What is the maximum property dividend that Klingon may pay to its common shareholders?

• A)$60,000
• B)$10,000
• C)$40,000
• D)$30,000

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Definitions:

Donee Beneficiary

A third party who benefits from a contract, although not one of the principals to the contract.

Uniform Commercial Code

A comprehensive set of laws governing commercial transactions in the United States, intended to standardize legal statutes across states.

Sale of Goods

A transaction where the ownership of tangible personal property is transferred from one party to another, usually in exchange for a price.

Writing

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