Acc 202 ch. 13: corporations
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35 terms
Terms | Definitions |
|---|---|
 authorized stock | number of shares that a carter allows a corp. to sell |
| market value of stock | price at which a stock is bought and sold |
| par value of stock | amount assigned per share in a compay's charter |
| no par value stock | no assigned value in charter. stock sold at any price |
| minimum legal capital protects...(who) | creditors |
| stated value stock | it is no par stock, but directors a "stated value" per share |
| paid in capital is... | the total amount of cash and other assets the corp. receives from its stockholder in exchange for stock |
| JE for issuing par value stock at par value | cash. dr common stock, $10 par value. cr. issued shares of par value common stock a par |
| JE for issuing par value stock at a premium | cash. dr. common stock, 10 par value. cr. Paid in capital in excess of par value common sock. cr. |
| discount on common stock account (info about it) | contra to the common stock account. dr balance. not legal to sell stock at a discount in most states. |
| JE for issuing no par value stock | cash. dr. common stock, no par stock. cr. |
| JE for issuing stated value stock | cash. dr. common stock, 40 stated value. cr. paid in capital in excess of stated value, common stock. cr. |
| JE Issuing stock for non cash assets | Land. dr. common stock, $ par value. cr. paid in capital in excess of par value, common stock. cr. |
| JE giving stock in exchange for promotion | operational expense. dr. common stock, $ par value. cr. paid in capital in excess of par value, common stock. cr. |
| three important dates for dividends | date of declaration-decide to pay date of record-decide in date to pay date of payment-when dividends is paid |
| JE date of declaration | retained earnings. dr. common dividends payable. cr. |
| JE date of payment | common dividends payable. dr. cash. cr. |
| dr or cr " retained earnings account" | cr (equity) |
| retained earnings loss | when a company either has cumulative loss, or pay dividends that exceed what it made casing a deficit. (a deduction on the BS after CS |
| stock dividend | gives more stock to existing stock holders with out any payment |
| 2 reasons for a stock dividend | 1. keeps price affordable 2. provides evidence that management thinks the company is doing well. |
| small stock dividend | 25% or less of previously outstanding share |
| JE small stock dividends (date of declarations) | retained earnings. dr commons stock dividend distributable cr. paid in capital in exess of par value. cr. |
| JEsmall stock dividend (date of payment) | common stock dividends distributable. dr. common stock, $10 par value. cr.. |
| "common stock dividend distributable" is a dr or cr account | cr (equity) |
| JE for large stock dividend | retained earnings. dr. common stock div. payable. cr. |
| JE issuance of preferred stock | cash. dr prefered stock, $ par value. cr paid in capital in excess of par value. cr. |
| convertible prefered stock | give holders the right to exchange their stock for common stock at a prefered rate. |
| callable prefered stock | gives the corp. the right to retire (purchase) this stock from its holders at a specific future date and price. |
| why prefered stock is issued | corp. gets capital without giving up power over organization. ie no voting rights |
| JEpurchasing treasury stock | treasurey stock, common. dr. cash. cr |
| treasury stock is what type of account | contra equity |
| JE reissuing treasury stock | cash. dr. treasury stock, common. cr. |
| JE selling treasury stock above cost | cash. dr.. treasury stock, common. cr. paid in capital' treasury stock. cr. |
| JE selling treasury stock below cost | cash. dr. paid in capital, treasury stock. dr. retained earnings. dr. treasures stock common. cr. |
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