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From page 10-2 of the VLN, the common stock account amount is determined Group of answer choices A. Par value x issued shares B. Par value x outstanding shares C. Par value x authorized shares D. Par value x unissued shares

From page 10-2 of the VLN, the common stock account amount is determined Group of answer choices A. Par value x issued shares B. Par value x outstanding shares C. Par value x authorized shares D. Par value x unissued shares

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter14: Corporation Accounting
Section: Chapter Questions
Problem 8MC: The total amount of cash and other assets received by a corporation from the stockholders in...
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From page 10-2 of the VLN, the common stock account amount is determined Group of answer choices A. Par value x issued shares B. Par value x outstanding shares C. Par value x authorized shares D. Par value x unissued shares
Treasury Stock: PREFERRED STOCK -Not normally voting -Preference in dividends -Fixed dividend rate (% of par or specified amount) -Cumulative (dividends in arrears) -Convertible -Redeemable -Mandatory Redeemable preferred stock is treated as debt on the balance sheet Par value or Stated value -legal capital -not market value Paid-In Capital -Preferred stock (PAR Value x number of shares ISSUED) -Common Stock (PAR VALUE x number of shares ISSUED) - Additional Paid-in Capital “APIC" or Capital in excess of Par No-par Stock Paid in capital all goes into common stock Practice A firm issues 50,000 shares of $0.10 par common stock for $10 per share, record the issuance. A firm issues 50,000 shares of $100 par preferred stock for $110 per share, record the issuance. A firm issues 50,000 shares of no par common stock for $10 per share, record the issuance. TREASURY STOCK -Contra Equity (reduces SEà does NOT reduce common stock) -Issued but NOT outstanding -Recorded at COST -No voting rights -No dividend or distribution rights Economic Gain on sale of Treasury Stock (Resold for more than cost) -not shown as a GAIN -increase Additional paid in capital Economic Loss on sale of Treasury Stock (Resold for less than cost) -not shown as a LOSS -decrease Additional paid in capital if available, or, if not available -decrease Retained Earnings
Transcribed Image Text:Treasury Stock: PREFERRED STOCK -Not normally voting -Preference in dividends -Fixed dividend rate (% of par or specified amount) -Cumulative (dividends in arrears) -Convertible -Redeemable -Mandatory Redeemable preferred stock is treated as debt on the balance sheet Par value or Stated value -legal capital -not market value Paid-In Capital -Preferred stock (PAR Value x number of shares ISSUED) -Common Stock (PAR VALUE x number of shares ISSUED) - Additional Paid-in Capital “APIC" or Capital in excess of Par No-par Stock Paid in capital all goes into common stock Practice A firm issues 50,000 shares of $0.10 par common stock for $10 per share, record the issuance. A firm issues 50,000 shares of $100 par preferred stock for $110 per share, record the issuance. A firm issues 50,000 shares of no par common stock for $10 per share, record the issuance. TREASURY STOCK -Contra Equity (reduces SEà does NOT reduce common stock) -Issued but NOT outstanding -Recorded at COST -No voting rights -No dividend or distribution rights Economic Gain on sale of Treasury Stock (Resold for more than cost) -not shown as a GAIN -increase Additional paid in capital Economic Loss on sale of Treasury Stock (Resold for less than cost) -not shown as a LOSS -decrease Additional paid in capital if available, or, if not available -decrease Retained Earnings
OWNERSHIP OF A CORPORATION Overview of Stockholders' Equity -Source of financing (A= L+ SE) -Ownership of the corporation (A-L=SE) Stockholders' Equity on the Balance Sheet Paid-in Capital + Retained Earnings – Treasury stock PART A: Invested Capital (Paid-in Capital) Invested capital is the amount of resources contributed to a company by its owners. Corporations StockholdersàBoard of DirectorsàCEO Initial Public Offering (IPO) STOCKHOLDER RIGHTS: to vote, receive dividends, and share in the distribution of assets ADVANTAGES of a CORPORATION -limited liability -ability to raise capital and transfer ownership DISADVANTAGES of a CORPORATION -double taxation -SEC regulation requirements STOCK (Common Stock and Preferred Stock) Number of Shares Authorized Shares: Issued Shares: Outstanding Shares: Unissued Shares: Treasury Stock:
Transcribed Image Text:OWNERSHIP OF A CORPORATION Overview of Stockholders' Equity -Source of financing (A= L+ SE) -Ownership of the corporation (A-L=SE) Stockholders' Equity on the Balance Sheet Paid-in Capital + Retained Earnings – Treasury stock PART A: Invested Capital (Paid-in Capital) Invested capital is the amount of resources contributed to a company by its owners. Corporations StockholdersàBoard of DirectorsàCEO Initial Public Offering (IPO) STOCKHOLDER RIGHTS: to vote, receive dividends, and share in the distribution of assets ADVANTAGES of a CORPORATION -limited liability -ability to raise capital and transfer ownership DISADVANTAGES of a CORPORATION -double taxation -SEC regulation requirements STOCK (Common Stock and Preferred Stock) Number of Shares Authorized Shares: Issued Shares: Outstanding Shares: Unissued Shares: Treasury Stock:
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