When a Company Decides to Go Public, It Must File

question 51

Multiple Choice

When a company decides to go public, it must file a registration statement with the SEC. Which of the following statements is true regarding this registration process?

• A) A registration becomes effective 10 days after the final change has been submitted to the SEC.
• B) Tombstone ads can be published before the registration becomes effective.
• C) Securities can be sold before the registration becomes effective.
• D) The financial statements submitted for the registration process must be certified for the past six years. A registration becomes effective 20 days after the final change has been submitted to the SEC. No securities can be sold before the registration becomes effective however the tombstone ads can be published. However, tombstone ads may be published to announce the anticipated offering.

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Definitions:

Actual Production

The real quantity of goods or services produced within a specific period, as opposed to planned or theoretical outputs.

Normal Production

The average production capacity or level of output that a manufacturing process or plant is designed to achieve under normal conditions.

Direct Material Quantity Variance

The variance between the real amount of materials consumed in production and the anticipated standard quantity, multiplied by the cost per unit set by standards.

Actual Production

The total amount of output that a company has produced within a specific period.