Which of the following relationships regarding shares of common stock are necessarily true? I. shares outstanding > issued shares II. authorized shares issued shares III. issued shares = treasury shares IV. issued shares shares outstanding
Suggested Answer:B🗳️
Only Selections II and IV are necessarily true. The number of authorized shares must always be greater than or equal to the number of shares that the firm offers to the public, which are the issued shares. The number of issued shares will be equal to the number of shares outstanding as long as the firm doesnt buy back any of its outstanding shares. Otherwise, the number of issued shares will exceed the number of shares outstanding since issued shares = shares outstanding + treasury shares. The issued shares would only be equal to the treasury shares if the firm repurchased all its shares outstanding.
Currently there are no comments in this discussion, be the first to comment!
This section is not available anymore. Please use the main Exam Page.Series 6 Exam Questions
Log in to ExamTopics
Sign in:
Community vote distribution
A (35%)
C (25%)
B (20%)
Other
Most Voted
A voting comment increases the vote count for the chosen answer by one.
Upvoting a comment with a selected answer will also increase the vote count towards that answer by one.
So if you see a comment that you already agree with, you can upvote it instead of posting a new comment.
Comments