Preferred stockholders' claims to a corporation's assets take precedence over the claims of some creditors.
Answer the following statement true (T) or false (F)
False
Preferred stock often has a liquidation value. In case of bankruptcy, preferred stockholders must be paid the liquidation value before any assets are distributed to common stockholders. However, preferred stockholder claims still fall behind creditor claims.
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If a retiring partner agrees to withdraw less than the book value of his/her interest, the effect of the transaction will decrease the capital accounts of the remaining partners
a. True b. False Indicate whether the statement is true or false
Rice hired Carter, a real estate broker, to buy a certain piece of land from King for $25,000 . Carter signed a contract agreeing to pay King $30,000 . When Rice heard, she refused to go through with the contract. What action can King take?
Get Moving, a fitness equipment retailer, has been successful in a strong economy by spending 4% of its sales revenues on promotions. What adjustments, if any, should Get Moving make now that the economy has gone into recession?
A. Continue to spend 4% of sales on promotions, even though this results in a lower promotional budget. B. Increase the promotional budget to attract new customers C. Decrease the promotional budget. No one has any money to spend anyway. D. Spend 4% of profits on promotions rather than 4% of sales.
The § 465 at-risk provision and the § 469 passive activity loss provision have decreased the tax attractiveness of investments in real estate for partnerships and for limited liability companies
a. True b. False Indicate whether the statement is true or false