3.1 Accounting 211 - Accounting 211 Monday March 1st 1999...

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Accounting 211 Monday, March 1st, 1999 Announcements: none Lecture notes: Chapter 12 Homework Questions 1. A corporation is a body of persons granted a charter legally recognizing them as a separate entity having its own rights, privileges, and liabilities distinct from those of its members. To be formed, incorporators must file an application with the proper state official. 2. The board of directors determines the major business policies of the corporation and appoints managers to carry them out. 4. Separate Legal Entity--has legal rights Limited Liability--responsible for its actions and liabilities Ease of Capital Generation--easy to raise money Ease of Transfer of Ownership--easy to buy and sell stock Lack of Mutual Agency--one person can't make decisions for all Continuous Existence--can exist without the owner Centralized Authority and Responsibility--president in charge
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Unformatted text preview: 5. Government Regulation--must meet state laws Taxation--double taxation Limited Liability--restricts borrowing of money Separation of Ownership and Control--management's decisions may be bad 9. a) date dividend is formally declared b) date the right to receive a dividend is determined c) date the dividend is paid to the stockholders 10. Cash dividends are declared, then a date of record determines who receives them, and finally they are paid to those stockholders. 14. Treasury stock is capital stock that has been issued and reacquired by the issuing company and has not been subsequently been resold or retired. It may be done to increase earnings per share, prevent takeover, or have more stock to distribute. Short Exercises 4. 5/15 Divid ends 7,000 Divid ends Payab le 7,000 6/15 Divid ends Payab le 7,000 Cash...
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  • Spring '99
  • Johnston
  • Accounting, Separate legal entity, Payab le 7,000, proper state official, major business policies

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