A Company Is About to Issue New Shares of Stock

question 107

Multiple Choice

A company is about to issue new shares of stock.If the par value per share is $4.00, the price of the new shares will most likely be:

• A)Less than $4.00.
• B)Equal to $4.00.
• C)Greater than $4.00.
• D)Equal to the capital surplus.

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Definitions:

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set.

Specific Identification

An inventory costing method that tracks the exact cost of each individual item in inventory to determine cost of goods sold.

Estimated Gross Profit

An expected amount of profit calculated by subtracting the estimated cost of goods sold from the estimated total sales revenue.

Sales Totaled

This term refers to the aggregate amount of revenue generated from the sale of goods or services over a specific period.