If a firm sells a total of 100 shares of stock,then
A)each share represents 1 percent of the firm's indebtedness.
B)each share represents ownership of 1 percent of the firm.
C)the firm is engaging in term finance.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

Each share of stock represents ownership in the firm, and therefore the more shares owned, the larger the percentage of ownership. In this case, each share represents 1/100th, or 1%, of ownership in the firm. Choices A and C are not relevant to the situation described.

If a Firm Sells a Total of 100 Shares of Stock,then