The Owners of a Corporation Are Its Shareholders

question 11

Multiple Choice

The owners of a corporation are its shareholders.If a corporation has only one class of shares,they typically are labeled common shares.Each of the following are ownership rights held by common shareholders,unless specifically withheld by agreement,except:

• A)The right to vote on policy issues.
• B)The right to share in profits when dividends are declared (in proportion to the percentage of shares owned by the shareholder).
• C)The right to dividends equal to a stated rate time par value (if dividends are paid).
• D)The right to share in the distribution of any assets remaining at liquidation after other claims are satisfied.

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Definitions:

Assets

Resources owned or controlled by a business, entity, or individual, with future economic value that can be measured and expressed in financial terms.

Externalities

Effects a project has on other parts of the firm or on the environment.

Cash Flow Estimation

The process of forecasting the cash inflows and outflows over a specific period, vital for budgeting and financial planning.

Cash Flows

The complete volume of financial transactions in and out of a business, crucially influencing its cash on hand.