ACC423 week one individual jamie hall

ACC423 week one - Corporations and Stock 1 Corporations and Stock ACC423 Jamie Hall Corporations and Stock 2 Corporations and Stock Corporations

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Corporations and Stock 1 Corporations and Stock ACC423 Jamie Hall
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Corporations and Stock 2 Corporations and Stock Corporations are the most prevalent and successful of all business types. The main reason that corporations are so prosperous is because of their ability to use stock to gain capital. The two types of stock are common stock and preferred stock. When recording transactions involving stock the paid in capital account is used. When investors evaluate the financial statements of a company they will look at the paid in capital account, an owners’ equity account, when making decisions to invest in a company. The three categories that owners equity consists of are capital stock, additional paid in capital and retained earnings. Capital stock reflects the amount of stock a company has issued. Additional paid in capital reflects the additional amount of money made off of the sale of stock over par value. These two categories go hand and hand. Retained earnings account represents the company’s earnings from operations. The owner’s equity portion of a corporations account represents their ability to make a profit. Although the owners equity portion of a company’s financials consist of all three
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This note was uploaded on 09/14/2010 for the course ACC 429 taught by Professor Whitehurst during the Spring '10 term at Chattanooga State.

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ACC423 week one - Corporations and Stock 1 Corporations and Stock ACC423 Jamie Hall Corporations and Stock 2 Corporations and Stock Corporations

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