All of the following are primary events that typically lead to changes in book value of shareholders equity except: to investors and sometimes in the form of share repurchases.

• A. Investments by shareholders, usually net cash received by the company at equity issue date.

• B. Profitable operating and investing activities, with net income being a large component of this increase.

• C. Debtholders requiring firms to enter into debt covenants.

• D. Distributions to shareholders, usually in the form of periodic cash dividend payments

Which of the following is the typical tradeoff when issuing preferred stock?

• A. The tradeoff between different accounting for an initial issuance of preferred stock as compared to a common stock issuance.

• B. The tradeoff between maintaining corporate control and creating a class of shareholders with preference in all asset distributions.

• C. The tradeoff of giving common shareholders priority over preferred shareholders in corporate liquidations.

• D. The tradeoff of a convertibility feature of common shares into preferred shares.

Which of the following is the date on which a company incurs a legal liability to distribute the dividend to owners of the stock?

• A. date of record

• B. commitment date

• C. date of declaration

• D. date of payment