MBA 601 Final Exam Questions and
Actual Answers 2025-2026 Edition.
A share of stock entitles you to - Answer A percentage of the earnings of the company
The cost of providing goods and services to customers is called - Answer expenses
Benefits (i.e. money) that a company receives from its customers is called - Answer revenue
Revenue - Expenses = - Answer Earnings, profit, net income
A company must pay out the profits that it earns to the stockholders. - Answer false
An ordinary dividend is - Answer A distribution of earnings to the shareholders
Companies that are growing quickly usually issue dividends - Answer false
You can make money investing in stocks by (select all that apply) - Answer collecting dividends
stock price appreciation
the advantage of sole proprietorship is - Answer complete control
the primary reason for starting a corporation is - Answer to raise a lot of capital
a corporation is its own separate legal entity - Answer true
in a corporation the owner is also the manager - Answer false
if you are an investor in a corporation, limited liability means - Answer you are only liable for
your investment in the company
, If a corporation had earnings of $40,000 and paid all of this out as a dividend to the owners,
how much tax would the federal government collect? Assume a 20% federal income tax rate
and a 15% dividend tax rate. - Answer first do the federal gov tax:
40,000 * .20 = 8,000
then tax the remaining as the dividend tax
32,000 * .15 = 4,800
Then add the two taxes together
8,000+4,800 = 12,800
so $12800
If a corporation had earnings of $40,000 and paid all of this out as a dividend to the owners,
how much tax would the corporate entity pay the federal government? Assume a 20% federal
income tax rate and a 15% dividend tax rate. - Answer you are finding how much the
corporation is paying to the fed gov, so take the 40,000 and multiply it by the fed giv tax rate .20
to get $8000
The primary advantages of investing in stock are - Answer unlimited upside
voting rights
the primary advantages of investing in bonds are - Answer easier to value than stock
known payment amount
know when you are going to get paid
less risk than investing in stock
priority over stockholders in bankruptcy
when companies issue stock they give up - Answer control
ownership and the right to future earnings
The advantages of issuing bonds are - Answer limited upside
financial leverage
it is riskier for a company to issue stock or bonds - Answer bonds
Actual Answers 2025-2026 Edition.
A share of stock entitles you to - Answer A percentage of the earnings of the company
The cost of providing goods and services to customers is called - Answer expenses
Benefits (i.e. money) that a company receives from its customers is called - Answer revenue
Revenue - Expenses = - Answer Earnings, profit, net income
A company must pay out the profits that it earns to the stockholders. - Answer false
An ordinary dividend is - Answer A distribution of earnings to the shareholders
Companies that are growing quickly usually issue dividends - Answer false
You can make money investing in stocks by (select all that apply) - Answer collecting dividends
stock price appreciation
the advantage of sole proprietorship is - Answer complete control
the primary reason for starting a corporation is - Answer to raise a lot of capital
a corporation is its own separate legal entity - Answer true
in a corporation the owner is also the manager - Answer false
if you are an investor in a corporation, limited liability means - Answer you are only liable for
your investment in the company
, If a corporation had earnings of $40,000 and paid all of this out as a dividend to the owners,
how much tax would the federal government collect? Assume a 20% federal income tax rate
and a 15% dividend tax rate. - Answer first do the federal gov tax:
40,000 * .20 = 8,000
then tax the remaining as the dividend tax
32,000 * .15 = 4,800
Then add the two taxes together
8,000+4,800 = 12,800
so $12800
If a corporation had earnings of $40,000 and paid all of this out as a dividend to the owners,
how much tax would the corporate entity pay the federal government? Assume a 20% federal
income tax rate and a 15% dividend tax rate. - Answer you are finding how much the
corporation is paying to the fed gov, so take the 40,000 and multiply it by the fed giv tax rate .20
to get $8000
The primary advantages of investing in stock are - Answer unlimited upside
voting rights
the primary advantages of investing in bonds are - Answer easier to value than stock
known payment amount
know when you are going to get paid
less risk than investing in stock
priority over stockholders in bankruptcy
when companies issue stock they give up - Answer control
ownership and the right to future earnings
The advantages of issuing bonds are - Answer limited upside
financial leverage
it is riskier for a company to issue stock or bonds - Answer bonds
