Financial Management - Study Mode
[#316] A stock which is hybrid and works as a cross between debt and common stock is considered as
Correct Answer
(D) preferred stock
Explanation
Solution: A stock which is hybrid and works as a cross between debt and common stock is considered as preferred stock. Preferred stockholders have a higher claim to dividends or asset distribution than common stockholders.
[#317] Paid dividends to common stockholders Rs 67,600,000 and common shares outstanding 55,000,000 then dividend per share will be
Correct Answer
(A) Rs 1.23
Explanation
Solution: Dividend per Share = Dividend Paid / Shares Outstanding = 67600000 / 5500000 = Rs. 1.23
[#318] Procedure of finding present values in time value of money is classified as
Correct Answer
(B) discounting
Explanation
Solution: Procedure of finding present values in time value of money is classified as discounting. Discounting is the process of determining the present value of a payment or a stream of payments that is to be received in the future. Given the time value of money, a dollar is worth more today than it would be worth tomorrow. Discounting is the primary factor used in pricing a stream of tomorrow's cash flows.
[#319] Stockholders that do not get benefits even if company's earnings grow are classified as
Correct Answer
(A) preferred stockholders
Explanation
Solution: Stockholders that do not get benefits even if company's earnings grow are classified as preferred stockholders. Preferred shareholders have priority over common stockholders when it comes to dividends, which generally yield more than common stock and can be paid monthly or quarterly.
[#320] In balance sheet, sum of retained earnings and common stock are considered as
Correct Answer
(D) common equity
Explanation
Solution: In balance sheet, sum of retained earnings and common stock are considered as common equity. Common equity is the amount that all common shareholders have invested in a company. Most importantly, this includes the value of the common shares themselves.