ISSUANCE OF STOCK
authorized shares
The maximum number of shares a corporation may issue as indicated in the corporate charter.
Issuance of Stock
The sale of stock from the corporation to the investing public
The adequacy of the consideration received for stock issued by a corporation is determined by which of the following? A The corporation's board of directors B The corporation's shareholders C The corporation's creditors D The Secretary of State
The corporation's board of directors
Prior to incorporation: Subscription agreements are irrevocable for ______________________________.
6 months
Which of the following statements regarding par value stock is FALSE? A Par value can be a nominal amount. B A corporation may, but is not required to, issue par value stock. C A corporation must sell the par value shares for less than the maximum par value amount. D A corporation must sell the par value shares for at least the par value amount.
A corporation must sell the par value shares for less than the maximum par value amount.
Stock Subscriptions
Ask people to agree in advance to buy stock before the corporation is formed.
to issue shares
Number of shares from the authorized pool that the directors have actually sold
Water Stock
The corporation sets a par value amount and sells the stock for less than the stated amount
What is the name given to shares of stock issued to shareholders that remains in their possession?
Outstanding shares
Which best describes stock that is eligible to vote on corporate matters? A Authorized stock B Issued stock C Outstanding stock D Treasury stock
Outstanding stock
Preemptive Rights
Right to acquire stock to maintain the percentage of ownership any time new shares are issued
Which of the following statements regarding preemptive rights is TRUE? A Preemptive rights provide existing shareholders the right to buy stock issued by the corporation in the future at a bargain price. B Preemptive rights require existing shareholders to buy additional shares that are issued by a corporation to maintain their proportional ownership in the corporation. C Preemptive rights give preferred shareholders the opportunity to convert their shares into common stock of the corporation. D Shareholders generally do not have preemptive rights, unless the articles of incorporation provide otherwise.
Shareholders generally do not have preemptive rights, unless the articles of incorporation provide otherwise.
outstanding shares
Shares that were once issued to shareholders and still remain in the possession of the shareholders
treasury shares
Stock previously issued to shareholders, but then reacquired by the corporation
Corporation can receive ______ valid consideration that the board of directors deems adequate
any
four concepts
authorized shares issue shares outstanding shares treasury shares
par value stock
capital stock that has been assigned a value per share in the corporate charter
Outstanding shares
issued- bought back shares
Default rule in most jurisdictions: Shareholders ______________________________ preemptive rights unless negotiated or included in the articles.
do not have
Stock that has been issued by a corporation and then reacquired by the corporation is called __________ stock.
treasury
it's only outstanding shares whose ______is important.
vote
usually, only outstanding shares are
voted