Ch21-TB-BLTE-8e

Ch21-TB-BLTE-8e - Chapter21 InvestorProtection,Insider

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Chapter 21 Investor Protection, Insider  Trading, and Corporate Governance TRUE/FALSE QUESTIONS 1. Securities include investment contracts. ANSWER: T PAGE: 641 TYPE: N MISC: AACSB Analytic Skill Level: AICPA Legal 2. Among the most common forms of securities is corporate stock. ANSWER: T PAGE: 641 TYPE: + MISC: AACSB Reflective Skill Level: AICPA Critical  Thinking 3. The Securities and Exchange Commission regulates the trade in securities. ANSWER: T PAGE: 642 TYPE: = MISC: AACSB Analytic Skill Level: AICPA Legal 4. The U.S. Internal Revenue Service prosecutes criminal violations of federal  securities law. ANSWER: F PAGE: 642 TYPE: = MISC: AACSB Analytic Skill Level: AICPA Legal 5. A security that qualifies for an exemption must be registered before it is  offered to the public. ANSWER: F PAGE: 642 TYPE: N 63
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64 TEST BANK TO ACCOMPANY BUSINESS LAW TODAY: THE ESSENTIALS MISC: AACSB Analytic Skill Level: AICPA Legal 6. The Securities and Exchange Commission, but not investors, must be given  a prospectus. ANSWER: F PAGE: 642 TYPE: + MISC: AACSB Analytic Skill Level: AICPA Legal 7. No   securities   are   exempt   from   the   registration   requirements   of   the  Securities Act of 1933. ANSWER: F PAGE: 644 TYPE: = MISC: AACSB Analytic Skill Level: AICPA Legal 8. Sales of securities may  not  occur until ninety days after registration. ANSWER: F PAGE: 644 TYPE: = MISC: AACSB Analytic Skill Level: AICPA Legal 9. The red herring prospectus may  not  be distributed until ninety days after  registration. ANSWER: F PAGE: 644 TYPE: = MISC: AACSB Analytic Skill Level: AICPA Legal 10. Stock splits are exempt from the registration requirements of the Securities  Act of 1933. ANSWER: T PAGE: 644 TYPE: + MISC: AACSB Analytic Skill Level: AICPA Legal 11. An offering of $4 million in securities by a non-investment company can be  exempt from some of the requirements of the Securities Act of 1933. ANSWER: T PAGE: 646 TYPE: + MISC: AACSB Analytic Skill Level: AICPA Legal 12. Generally, stock offerings that are made in a limited manner during any  twelve-month period are exempt from registration requirements. ANSWER: T PAGE: 646 TYPE: + MISC: AACSB Analytic Skill Level: AICPA Legal
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CHAPTER 21: INVESTOR PROTECTION, INSIDER TRADING, AND CORP. GOVERNANCE 65 13. An offering of $10 million in securities by a non-investment company is  never  exempt from the Securities Act of 1933. ANSWER: F PAGE: 647 TYPE: N MISC: AACSB Analytic Skill Level: AICPA Legal 14. To be resold, most securities must be registered. ANSWER:
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Ch21-TB-BLTE-8e - Chapter21 InvestorProtection,Insider

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