Week 6 class 1

Week 6 class 1 - Week 6 class 1 1 A corporation is called a...

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Week 6 class 1 1. A corporation is called a “creature of the state” because it is an entity formed under federal or provincial law. Organization of a corporation starts with submission of articles of incorporation to the federal or a provincial government for approval. After the incorporators pay the required fees, sign the charter, and file the required documents with the incorporating jurisdiction, the corporation comes into existence. The incorporators agree to a set of bylaws for governing the corporation. The corporation then issues its shares and receives assets. The shareholders elect the board of directors, which appoints the officers. At this point, the corporation begins operations. 3. Issuance of 1,000 shares of $1.60, no par preferred shares for $25 would increase National Bank’s capital stock by $25,000 (1,000 × $25). The transaction would not increase retained earnings because a company does not earn a profit by selling its shares to its own shareholders. National Bank’s annual cash dividend payments would increase by $1,600 (1,000 × $1.60).
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This note was uploaded on 10/18/2010 for the course ACF ACC220 taught by Professor Fiona during the Spring '08 term at Seneca.

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Week 6 class 1 - Week 6 class 1 1 A corporation is called a...

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