11. Which of the following is the maximum number of shares that can be issued by the corporation as per the articles of incorporation?
A. Authorized capital stock
B. Issued shares
C. Outstanding shares
D. Treasury shares
12. Which of the following statements concerning equity is correct?
A. A shareholder is entitled to a regular dividend.
B. The rights of the shareholder come before those of debt holders.
C. A shareholder can require the company to buy back his common shares at any time.
D. If a corporation goes bankrupt, shareholders will only receive a return on their investment after all debt holders have been paid.
13. Which of the following represents the residual interest in a company?
A. Preferred shares
B. Contributed surplus
C. Convertible bonds
D. Common shares
14. Which of the following best distinguishes preferred shares from common shares?
A. Preferred shares do not vote but do receive priority on dividends.
B. Preferred shares do not receive dividends but have priority on liquidation.
C. Preferred shares have the same dividends as common but receive priority on liquidation.
D. Preferred shares vote and receive priority on dividends and liquidation.
15. Which of the following preferred share characteristics allow the shareholder to have increases in their dividends above the stated amount?
A. Convertible
B. Redeemable
C. Participating
D. Cumulative
16. Which of the following preferred share characteristics give the shareholders the right to force the issuer to purchase the shares from them?
A. Convertible
B. Redeemable
C. Retractable
D. Cumulative
17. Which of the following preferred share characteristics allow the issuer to repurchase the preferred shares from the shareholder?
A. Convertible
B. Redeemable
C. Retractable
D. Cumulative
18. Which of the following preferred share characteristics allow the issuer to exchange their preferred shares for common shares?
A. Convertible
B. Redeemable
C. Retractable
D. Cumulative
19. What is a security that has the characteristics of both debt and equity called?
A. A preferred security
B. A common security
C. A hybrid security
D. A participating security
20. Which of the following is an example of a hybrid security?
A. A common share
B. A non-voting common share
C. A convertible preferred share
D. A bond.