Chapter11- power point-class

Chapter11- power point-class - CHAPTER 11 Reporting and...

Info icon This preview shows pages 1–12. Sign up to view the full content.

View Full Document Right Arrow Icon
Reporting and Analyzing Equity C H A P T E R 11
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Privately Held Privately Held Publicly Held Publicly Held Ownership can be Corporate Form of Organization Existence is separate from owners An entity created by law Has rights and privileges
Image of page 2
Advantages Separate legal entity Limited liability of stockholders Transferable ownership rights Continuous life Lack of mutual agency for stockholders Ease of capital accumulation Disadvantages Governmental regulation Corporate taxation Characteristics of Corporations
Image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Forming a Corporation Application made to the State Government State Government issues “Charter” and a corporation is formed. Investors purchase corporations stock Stockholders elect Board of Directors “Organization costs”( legal fees promoters fees etc) are expensed as incurred
Image of page 4
C o r p o r a t e O r g a n i z a t i o n C h a r t S e c r e t a r y V i c e P r e s i d e n t F i n a n c e V i c e P r e s i d e n t P r o d u c t i o n V i c e P r e s i d e n t M a r k e t i n g P r e s i d e n t B o a r d o f D i r e c t o r s S t o c k h o l d e r s Ultimate control. Stockholders usually meet once a year. Organizing and Managing a Corporation Selected by a vote of the stockholders. Overall responsibility for managing the company.
Image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Vote at stockholders’ meetings Sell stock Purchase additional shares of stock Receive dividends, if any Share equally in any assets remaining after creditors are paid in a liquidation Rights of Stockholders
Image of page 6
Each unit of ownership is called a share of stock . A stock certificate serves as proof that a stockholder has purchased shares. Stock Certificates and Transfer When the stock is sold, the stockholder signs a transfer endorsement on the back of the stock certificate. Investment Bankers/ Brokers Registrar Transfer Agents
Image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Authorized, Issued Outstanding STOCK BASICS Issued OUTSTANDING AUTHORIZED ISSUED
Image of page 8
STOCKHOLDERS’ EQUITY Common Stock, par value $0.05; Authorized: 10,000 shares ; Issued 2,421 shares Outstanding 1,970 shares ……………… 121 Paid-In Capital…………………………….. 7,930 Retained Earnings ………………………. 33,052 Accumulated Other Comprehensive Income 310 Treasury Stock, at cost, 451 shares…….. (16,383) Total Stockholders’ Equity……………… 25,030 STOCK BASICS From Home Depot’s 2006 Annual Report Amounts in millions Authorized, Issued Outstanding
Image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Par value is an arbitrary amount assigned to each share of stock when it is authorized. Home Depot Inc Par Value $ 0.05 Market price is the amount that each share of stock will sell for in the market. Home Depot Inc Market price _______ Selling (Issuing) Stock No Par stock Stated Value
Image of page 10
Preferred Stock typically having priority over common shares in . . . Dividend distributions Distribution of assets in case of liquidation Usually has a stated dividend rate Normally has no voting rights TYPES OF STOCK Common Stock When only one class of stock is outstanding.
Image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 12
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern