When a certificate of stock is issued for shares whose subscription is not fully paid, then –a) the certificates are deemed null and void for being in violation of express prohibition of the Corporation Code.b) the directors and officers who allowed such issuance of the certificate shall be liable to the corporation for the balance of the subscription that remains unpaid.c) the shares are conclusively deemed fully paid as to every due holder in good faith of the certificate of stock.d) the registered stockholder shall no longer be liable for the unpaid portion of the subscription.

The capital of a corporation is contributed by many number of persons and same is accounted in books…

Answered: When a certificate of stock is issued…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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When a certificate of stock is issued for shares whose subscription is not fully paid, then –

a) the certificates are deemed null and void for being in violation of express prohibition of the Corporation Code.
b) the directors and officers who allowed such issuance of the certificate shall be liable to the corporation for the balance of the subscription that remains unpaid.
c) the shares are conclusively deemed fully paid as to every due holder in good faith of the certificate of stock.
d) the registered stockholder shall no longer be liable for the unpaid portion of the subscription.

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