Which of the following statements is NOT CORRECT?"Going public" establishes a firm's true intrinsic value and ensures that a liquid market will always exist for the fiem's shares.Publicy owned companies have sold shares to investors who are not associated with management, and they must register with and report to a regulatory agency suchas the SEC.When stock in a closely held corporation is offered to the public for the first time, the transaction is called "going public," and the market for such stock is called henew issue market.It is possible for a firm to go public and yet not raise any additional new capitalWhen a corporation's shares are owned by a few individuals who own most of the stock or are part of the firm's management, we say that the fim is "closely, orprivately, held

PUBLIC COMPANY public company are those company which has sold all or part of its…

Answered: Which of the following statements is…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Shares are equity, but to the firm is a liability for the investor is an asset. What is the shares subject, equity, liability, or asset? For corporate, Shares is in where on the balance sheet?
If the articles of incorporation do not include a pre-emptive right, the firm has a choice of offering the issue of common stock directly to existing shareholders or to the public. True or False
Which statement pertaining to provisions in the Companies Act 71 of 2018 is true? Select one: a. No company is allowed to provide financial assistance to acquire its own shares. b. Only public companies can provide financial assistance to acquire their own shares. c. Only private companies can provide financial assistance to acquire their own shares. d. Private companies are free to provide financial assistance to acquire their own shares. Generally public companies are prohibited from providing such assistance, but can do so in limited circumstances.
The par value of common stock represents a. the estimated fair value of the stock when it was issued. b. the liability ceiling of a shareholder when a company undergoes bankruptcy proceedings. c. the total value of the stock that must be entered in the issuing corporation’s records. d. the amount that must be recorded on the issuing corporation’s record as paid-in capital.
Match each of the following stockholders' equity concepts to the appropriate term (a-h). Question 5 options: Document which formally creates a corporation Corporate income distributed to stockholders The rules and procedures for conducting a corporation's affairs Group which meets periodically to establish corporate policies A legal entity, separate from the people who create and operate it A company whose shares can be bought and sold in public markets A company whose shares are not bought or sold in public markets Creditors cannot pursue stockholders' personal assets to satisfy claims 1. articles of incorporation 2. limited liability 3. bylaws 4. corporation 5. public corporation 6. board of directors 7. private corporation 8. dividends
Type of corporation Companies that are owned by a group of investors, who could also be associated with the company's management, make initial public offerings. Such companies are referred to as Initial public offering perfo publicly owned corporations closely held corporations When the demand for an initiar puvne uneny uru ur securlties exceeds the number of securities issued, the offering is deemed to be: O Oversubscribed O Undersubscribed Indigo Inc. is going public and issuing 150,000 shares of common stock. The capital raised in the IPO will fund the company's proposed expansion. A Dutch auction is used to allocate shares in the Indigo IPO. The following table shows the number of shares requested by potential investors in each row. Bids Number of Shares Requested Price per Share Bidder # 1 50,000 $56 Bidder # 2 100,000 54 Bidder # 3 150,000 52 Bidder # 4 200,000 50 Bidder # 5 250,000 48 Bidder # 6 300,000 46 What should be the firm's IPO offer price? O $48 O $54 O $55 O $52 O $57…
. Buying shares in a corporation is attractive to investors because: a All of these answers are correct. b Shares are easily transferred c Shareholders are not liable for the corporation's actions and debts d Shareholders are not agents of the corporation e A corporation has unlimited life. PLEASE EXPLAIN YOUR ANSWER AND DO NOT COPY FROM OTHER SOURCES AND ALSO NOT GIVEN IN IMAGE FORMAT
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Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Which of the following characteristics are not an advantage of being a publicly traded company? Group of answer choices A. Allows the firm to play the merger game, using marketable securities for the purchase of other firms. B. Prestige is helpful in bank negotiations, executive recruitment and the marketing of products. C. Tapping into the security markets for a greater amount of funds. D. Compliance costs because of various public disclosure requirements.
As a large corporation, ABC plc. one or more could be correct. i. more likely than smaller businesses to issue stocks to raise funding. ii. more likely than smaller businesses to issue bonds to raise funding. iii. can reduce its principal-agent problem by maintaining the confidentiality of its boards decisions. iv. can reduce its principal-agent problems by allowing its board to monitor shareholder activities more closely.
Which of the following statements is TRUE? a. A shareholder's wealth in a firm is equal to the number of shares that the shareholder owns divided by the stock price. b. The Sarbanes-Oxley Act, passed by Congress in 2002, requires CEOs and CFOs to certify that the firm's balance sheet includes forecasted information. C. A stock trading at a price below its intrinsic value is considered to be undervalued. d. The CFO of a corporation is usually in charge of human resources and administration. mitmetes

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