Which of the Following Is/are True Regarding Stock Rights

question 101

Multiple Choice

Which of the following is/are true regarding stock rights?

• A)U.S.GAAP does not require recognition of the rights on the date of the grant.
• B)Firms often issue stock rights to raise new capital from current shareholders.
• C)Shareholders may exercise the stock rights or sell them to others.
• D)IFRS does not require recognition of the rights on the date of the grant.
• E)all of the above

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Definitions:

Par Value

The nominal or face value of a bond, share of stock, or other financial instrument, representing the value at which it is issued.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting liabilities, representing the ownership interest of shareholders.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, often with dividend payment preferences.

Par Value

The stated face value of a bond or the nominal value of a stock, unrelated to its market price.