The market value of a corporation's stock is determined by the number of shares that the corporation has been authorized to issue.

True

False

Treasury stock purchased for $25 per share that is reissued at $20 per share, results in a Loss on Sale of Treasury Stock being recognized on the income statement.

True

False

Dividends in arrears on cumulative preferred stock:

are shown in stockholders' equity of the balance sheet.

must be paid before common stockholders can receive a dividend.

should be recorded as a current liability until they are paid.

enable the preferred stockholders to share equally in corporate earnings with the common stockholders.