Exam 2 Quizlet

Cumulative

A company has four open seats on its board of directors. There are seven candidates vying for these four positions. There will be a single election to determine the winners. As the owner of 100 shares of stock, you will receive one vote per share for each open seat. You decide to cast all 400 of your votes for a single candidate. What is this type of voting called?

must still declare each dividend before it becomes an actual company liability.

Boston Free Press has a dividend policy whereby the firm pays a constant annual dividend of $2.40 per share of common stock. The firm has 1,000 shares of stock outstanding. The company:

Right to share in company profits prior to other shareholders

Hardy Lumber has a capital structure that includes bonds, preferred stock, and common stock. Which one of the following rights is most apt to be granted to the preferred shareholders?

If cumulative voting applies, Jen is assured one seat on the board.

Jen owns 30 shares of stock in Delta Fashions and wants to win a seat on the board of directors. The firm has a total of 100 shares of stock outstanding. Each share receives one vote. Presently, the company is voting to elect three new directors. Which one of the following statements must be true given this information?

50 percent plus one vote

The Blue Marlin is owned by a group of five shareholders who all vote independently and who all want personal control over the firm. What is the minimum percentage of the outstanding shares one of these shareholders must own if he or she is to gain personal control over this firm given that the firm uses straight voting?

Determining the amount of the dividend to be paid per share

Which one of the following rights is never directly granted to all shareholders of a publicly held corporation?

Corporate shareholders may receive a tax break on a portion of their dividend income.

Which one of the following statements related to corporate dividends is correct?

bond gets paid off at a maturity date but stock continues indefinitely, bond has a coupon/lump sum payment but stock has dividend payments forever, and coupons are fixed and dividends can change over time

what are the differences between stocks and bonds?

provide long term funding for an org, future funds that an investor must consider, future periodic payments, and can be purchased in a marketplace at a price today

what are the similarities between stocks and bonds?

company pays dividends and selling shares to another investor or back to the company

what two ways can you receive cash if you buy a share of stock?