Exam 34: Financial Structure of Corporations

Which of the following is correct with regard to "par value"?

A corporation may purchase its own shares only out of earned surplus unless the articles of incorporation or the shareholders permit purchase out of capital surplus.

__________, usually called debentures, have only the obligation of the corporation behind them.

The MBCA as amended in 1980 and the Revised Act have adopted a net asset test for the issuance of dividends.

Debentures are the same as indentures.

Participating preferred stock will:

The first federal statute for the regulation of securities offered for sale and sold through interstate commerce was passed in:

Yukon Corporation purchases 1,000 shares of its own stock from Jones at a price of $50 a share. These shares, which are now issued but not outstanding, are known as:

A "stock option" permits the purchase of shares at a later date.

Under the Revised Act, dividends must always be paid in money.

The 2016 RMBCA provides a statutory ratification procedure for shares that may have been improperly issued. Upon the effectiveness of the ratification, the overissued shares are valid shares as of

The federal government leaves corporate stock regulation to the states since corporations are state-created entities.

Stoddard purchases 200 shares of Air Fresh Corporation stock. Explain what, if any, liability Stoddard has to the corporation or its creditors with respect to the shares.

Which of the following is correct with regard to common stock?

In which of the following ways do debt and equity securities necessarily differ?

Debt securities represent an ownership interest in the corporation.

The Revised Act, the 1980 Amendments to the MBCA, and over half of the states have eliminated the concept of:

Preferred stockholders do not have priority over corporate creditors in liquidation.

Caverun Co. has two classes of stock. The company may:

Under the Revised Act, if the charter simply states that the corporation elects to have preemptive rights, the shareholders have no preemptive rights with respect to: