Which of the Following Is False

question 38

Multiple Choice

Which of the following is false?

• A) The common stock of a corporation can only be publicly owned.
• B) Firms often issue common stock with no par value.
• C) Preemptive rights help to prevent a dilution of ownership on the part of existing shareholders.
• D) A firm's corporate charter indicates how many authorized shares it can issue.

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Definitions:

Variable Costing

An accounting method that considers only variable production costs (such as materials and labor) in the calculation of product costs.

Net Operating Income

The profit derived from a company's regular business operations after deducting operating expenses such as rent, wages, and utilities.

Direct Labor Cost

The total cost of workforce expenses directly involved in the manufacturing of products or delivery of services, excluding indirect labor costs.

Absorption Costing

A costing methodology in accounting that factors in all costs associated with manufacturing, such as direct materials, direct labor, along with both variable and fixed overheads, into the product's cost.