Explanation Common stock : These are the ordinary shares that a corporation issues to the investors in order to raise funds. In return, the investors receive a share of profit from the profits earned by the corporation in the form of dividend. Authorized stock : It refers to the maximum number of shares preferred or common shares allowed by the state charter to be issued by the company. Issued stock : It refers to the number of shares that are sold to the stockholders from number of shares authorized for issuance by the company. Unissued stock: Unissued shares refer to the part of the authorized shares that are yet to be issued to the public for subscribe Outstanding stock : It refers to the number of shares that are held by the existing stockholders of the company. Treasury Stock : It refers to the shares that are reacquired by the corporation that are already issued to the stockholders, but reacquisition does not signify retirement...

Financial Accounting (12th Edition) (What's New in Accounting)

9th Edition

ISBN: 9780134726656

Author: Harrison

Publisher: PEARSON

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Chapter 10, Problem 10.61Q

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To identify: Which classification represents the most shares of common stock.

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Which classification represents the most shares of common stock.

Solution Summary: The author explains which classification represents the most shares of common stock. Authorized stock refers to the maximum number of shares preferred or common shares allowed by the state charter.

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To identify: Which classification represents the most shares of common stock.

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