{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Accounting Notes- 10-28

Accounting Notes- 10-28 - Issuance of stock-corporation can...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
ACCOUNTING 2000 10/28/11 - An entity separate and distinct from its owners - Classified by purpose: Not for profit For profit - Classified by ownership: Publicly held Privately held Characteristics of a corporation - separate legal existence -limited liability of stockholders -transferable ownership rights -ability to acquire capital -continuous life - corporate management - government regulations -additional taxes *yellow= advantage *green=disadvantage *blue=can be an advantage or disadvantage Forming a corporation (initial steps) 1. File application with secretary of state 2. State grants charter 3. Corporation develops by-laws CLICKER: which of the following is not a major advantage of a corporation? Government regulations Stockholder’s Rights -vote in election board of directors -share corporate ownership -keep same percentage ownership -share in assets upon liquidation (residual claim) Authorized stock -charter indicates amount of stock that a corporation is authorized to sell -number of authorized shares is often reported in stockholder’s equity section
Image of page 1

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

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Issuance of stock-corporation can issue common stock (directly and indirectly)-US Securities exchange Par value=arbitrary amount, usually low amount; protection of corporate creditors Paid in capital=total amount of cash and other assets paid in to the corporation by stockholder’s in exchange for capital stock Journal entries Issuing stock at par value: Cash Common Stock Issuing stock at above par value: Cash Common Stock Paid in Capital in excess par-common stock Ex: issue 1000 share $1 per value @ par Cash 1000 Common Stock 1000 Ex: issue 1000 shares $1 per value common stock @ $5 Cash 5000 Common stock 1000 Paid in capital in excess par-common stock 4000 Ex: issue $1000 shares $1 par value common stock @ $8 Cash 8000 Common stock 1000 Paid in capital in excess par- common stock 7000 CLICKER: 1000 shares of $1 par of common stock are issued at $8, what is the journal entry? Credit common stock for $1000...
View Full 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