1 / 9

CORPORATION

CORPORATION. A business organized as a legal entity separate and distinct from its owners. Chartered by the state with ownership divided into shares of transferable stock. Stockholders have limited liability. STOCKHOLDERS’ EQUITY.

sydnee
Download Presentation

CORPORATION

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. CORPORATION • A business organized as a legal entity separate and distinct from its owners. • Chartered by the state with ownership divided into shares of transferable stock. • Stockholders have limited liability.

  2. STOCKHOLDERS’ EQUITY • Residual interest in the assets of an entity that remain after deducting its liabilities • Assets minus Liabilities • Ownership Interest • Consists of: 1. Contributed (Paid-in) Capital 2. Retained Earnings

  3. TERMINOLOGY • Legal Capital • The amount of stockholders’ equity that cannot be distributed to stockholders. • Usually the total par value or stated value of the issued stock.

  4. TERMINOLOGY • Par Value • An arbitrary amount printed on the face of the stock certificate. • In most states, represents the minimum amount per share to be invested in the corporation when shares are originally issued. • No direct relationship to market value. • Stated Value • Similar to par value except it is not printed on the face of the stock certificate.

  5. TERMINOLOGY • Authorized SharesThe maximum number of shares the company is allowed to issue. • Issued SharesThe number of shares sold as of a specific date. • Outstanding SharesThe number of issued shares still held by stockholders as of a specific date.

  6. COMMON STOCK • Voting Rights • Share proportionately in profits and losses • Share proportionately in corporate assets upon liquidation • Preemptive Right

  7. PREFERRED STOCK: STANDARD FEATURES • No Voting Rights • Fixed dividend rate • Liquidating preference over common stock • Dividend preference over common stock

  8. PREFERRED STOCK: OPTIONAL FEATURES • Cumulative • Callable • Participating • Convertible • Redeemable

  9. TREASURY STOCK • A corporation’s issued stock that has subsequently been repurchased but not retired by the corporation. • Issued Shares minus Outstanding Shares • Why?

More Related