01 Stock

Question 1

Dividend Tax Indv

Answer 1

taxed in year received

Question 2

Dividend Tax Corp

Answer 2

70% exclusion of DIV from other Corp

Question 3

Common Stock Types

1 Authorized

2 Issued

3 Treasury

4 Outstanding

Answer 3

in charter may issue or sell for increase stockholder vote

Question 4

Common Stock Types

1 Authorized

2 Issued

3 Treasury

4 Outstanding

Answer 4

distributed to investors

Question 5

Common Stock Types

1 Authorized

2 Issued

3 Treasury

4 Outstanding

Answer 5

issued and co. repurchased no voting or DIV

Question 6

Common Stock Types

1 Authorized

2 Issued

3 Treasury

4 Outstanding

Answer 6

issued - treasury

Question 7

Par Value

• Definition
• Effect on stock mkt price

Answer 7

• Value company gives in articles
• no

Question 8

Capital in excess of par / surplus

Answer 8

stock sold higher than par

Question 9

Book Value

Answer 9

amount stockholder rcvs if co. liquidated

assets - liabilities / outstanding shares

Question 10

Statutory vs. Cumulative

100 shares

3 ballet items

= ? Votes

Answer 10

300 votes

STATCUM

100 200 or 300

100 60

100 40

Question 11

Stock Voting ?

• Class A
• Class B

Answer 11

• Voting
• Non voting

Question 12

Stockhoder Rights

Antidilustion Provision

Preemptive Right

Residual Claim / Right

Answer 12

additional stock 1st offered to stock holders before public

purchase new stock to keep = ownership

right to get $ in backruptcy

Question 13

limited liability

Answer 13

stockholders do not pay co debt on bankruptcy

Question 14

junior security

Answer 14

stock - last in line liquidation

Question 15

Preferred Stock

1. Ownership
2. Dividends
3. Bankruptcy
4. Pricing

Answer 15

1. Ownership - yes, not same voting rights
2. Dividends - fixed semi-annual,

not guarenteed

3. Bankruptcy - paid 1st
4. Pricing - based in interest,

inverse relation like bonds

Question 16

Preferred Stock Types

straight preferred

cumulative preferred

patricipating preferred

Answer 16

straight

missed DIV not paid

cumulative

missed DIV paid before common

patricipating

% corp profits

Question 17

Right

vs

Warrent

vs

Callable

Answer 17

Right - investor buy below MP

Warrent - investor opp to buy in future @ specific price

Call - co. can buy back after specific date

Question 18

callable / redeemable

Answer 18

co. can buy back after specific date

Question 20

stock power

Answer 20

doc used to transfer ownership

Question 22

Rights Offering

Answer 22

buy stock below current mkt price

Question 24

subscription right

Answer 24

defined - $, date, #

30-45 days to by additional shares

Question 26

Value of a Right

• Before Ex Date
• After Ex Date

Answer 26

Question 28

Warrent

1 - Traded Where?

2 - DIV - Y / N

3 - Voting - Y / N

4 - Benefits

Answer 28

1 - Traded - 2nd mkt

2 - DIV - N

3 - Voting - N

4 - Benefits

• leverage
• long - term
• right to future purchase @ specific price

Question 30

ADR

1. definition
2. voting
3. taxes
4. risk

Answer 30

American Depository Receipts

1. stocks in foreign corp, in US $

2. no vote
3. pay foreign taxes - credit on US taxes
4. currancy

Question 32

Custodian Bank

Answer 32

foreign branches of US Banks issue ADRs sells in US _not_ foreign mkt

Question 33

ADR risk

Answer 33

currency