Stockholders Share in the Profits of a Corporation

question 39

Multiple Choice

Stockholders share in the profits of a corporation:

• A)in proportion to their years of stock ownership.
• B)in proportion to their ownership of stock.
• C)equally regardless of number of shares owned.
• D)only if they participate in management decisions.
• E)only if they attend stockholders' meetings.

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Definitions:

Cash Payment

A transaction in which a payment is made in the form of physical currency or through a digital mechanism but representing immediate transfer of funds.

Merchandise

Goods or products that are bought and sold by businesses in the course of their trade or business operations.

Sales Returns and Allowances

Transactions in which customers return damaged or unsatisfactory products for refunds or credit, and adjustments made to sales revenue for these returns or granted concessions.

Accounts Receivable

Outstanding payments from customers to a firm for delivered or utilized goods or services awaiting settlement.