The Klodhoffer Corporation has assets amounting to $2 million and needs additional capital to finance expansion of its operation. The board of directors decides to promote an issue of $1.5 million of common stock in order to raise capital. At the time
the stock is issued, Klodhoffer has 250 shareholders owning common stock. If Klodhoffer is to trade the stock over the counter, does it need to register with the SEC?
The issue is exempt from registration under Rule 505 as long as the Klodhoffer issue does not exceed $5 million over 12 months. The issue may be purchased by an unlimited number of accredited investors and by no more than 35 other purchasers. If the sale involves any nonaccredited investors, the issuer must, before the sale, give them specified material information about the issuer, its business, and the securities being offered. An exemption under Rule 505 requires the issuer to file online a Form D with the SEC within 15 days after the first sale of securities in the offering.
Also, Regulation A would permit Klodhoffer to issue up to $5 million of securities in a 12-month period without registering them if Klodhoffer files an offering statement with the SEC prior to selling the securities. An offering circular would have to be provided to offerees and purchasers. Regulation A does not restrict the number or qualifications of investors, and the securities may be resold freely.
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The Halo Effect is best avoided by:
A) doing a couple of things wrong during the entire research project B) mixing favorable and unfavorable endpoints on a scale C) flipping "bad" scales to the back of the survey to encourage a good response before the respondents get to the bad questions D) substituting "good" measurements to replace those thought to be faulty E) none of the above; the Halo Effect cannot be avoided
Which of the following transactions will not result in an increase in revenues?
A) Sale of goods on credit. B) Sale of services for cash. C) Accumulation of interest in bank account. D) The sale of shares of common stock to investors.
A company purchased mining property for $4,875,000 containing an estimated 15,000,000 tons of ore. In Year 1, it mined 689,000 tons of ore and in Year 2, it mined 935,000 tons. Calculate the depletion expense for Year 1 and Year 2 and determine the book value of the property at the end of Year 2.$4,875,000/15,000,000 tons = $0.325 per tonYear 1: 689,000 tons * $0.325 per ton = $223,925Year 2: 935,000 tons * $0.325 per ton = $303,875
What will be an ideal response?
The term "corporate manager" refers to:
a. directors. b. corporate officers. c. Both of the above. d. None of the above.