Tangshan Mining Has Common Stock at Par of $200,000, Paid-In

question 61

Multiple Choice

Tangshan Mining has common stock at par of $200,000, paid-in capital in excess of par of $400,000, and retained earnings of $280,000. In states where the firm's legal capital is defined as the par value of common stock, the firm could pay out ________ in cash dividends without impairing its capital.

• A) $200,000
• B) $680,000
• C) $600,000
• D) $880,000

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Definitions:

Uniform Commercial Code

A comprehensive set of laws governing commercial transactions in the United States, intended to standardize regulations across the states to facilitate easier interstate commerce.

Model Code

A systematically arranged collection or compendium of guidelines, rules, or regulations that is designed to serve as a template or reference for legal reform or drafting.

Commercial Transactions

Business dealings or the exchange of goods, services, or financial assets between parties in the marketplace.

Adaptive System

A system that is capable of adjusting its behavior or structure based on changes in its environment or internal state.