The Total Amount of Cash and Other Assets Received by a Corporation

question 136

Multiple Choice

The total amount of cash and other assets received by a corporation from its stockholders in exchange for its stock is:

• A)Always equal to its par value.
• B)Always equal to its stated value.
• C)Referred to as paid-in capital.
• D)Referred to as retained earnings.
• E)Always below its stated value.

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Definitions:

Saving

The portion of income not spent on consumption but reserved for future use, often placed in banks, investments, or other financial instruments for growth.

Disposable Income

The money that remains for savings and expenses after income tax deductions from a person's or family's earnings is the disposable income.

APS

Average Propensity to Save, the proportion of total income that is saved by a household or economy.

Saving

The act of setting aside a portion of income for future use, typically in a bank account or other secure investment.