Which One of the Following Can Be Assumed When the SEC

question 45

Multiple Choice

Which one of the following can be assumed when the SEC approves an IPO registration?

• A)The securities offering will provide value to the shareholders.
• B)The issuer is financially sound.
• C)The issuer will remain solvent.
• D)All rules have been followed to allow for full disclosure of information.
• E)The stock price is set at a level which will allow shareholders to earn a positive rate of return.

---

Definitions:

Adjusting Entries

Entries made in the general journal at the close of an accounting period to update the ledger accounts for any income or expenses incurred but not yet recorded.

Condensed Worksheet

A simplified financial statement that consolidates and presents a company’s financial status in a concise format.

Accounting Cycle

The series of steps followed by an organization to track and manage financial transactions, from the initial transaction to the closing of the books.

Special Journals

Special journals are accounting journals designed for recording specific types of transactions in a detailed manner, such as sales or purchases, to streamline the accounting process.