Which of the Following Statements About a Bonus Issue Is

question 17

Multiple Choice

Which of the following statements about a bonus issue is NOT true?

• A) Shareholders will only gain if the market value of the combined shares is greater than it was before the bonus issue.
• B) Total shareholders' equity remains constant.
• C) The total value of the firm must increase.
• D) If a shareholder owned 10% of the company before the bonus issue,she or he would still own 10% after the bonus issue.

---

Definitions:

Differentiation Value

The unique attributes or benefits that make a product or service stand out from competitors, enhancing its market appeal.

Useful Life

The estimated period over which a fixed asset is expected to be usable by the organization, impacting its depreciation calculation.

Operating Costs

The ongoing expenses related to running a business, excluding the cost of goods sold, such as rent, utilities, and payroll.

Service Hours

The total hours spent by an organization or employee providing services to clients or working on service-related tasks.