会计学ch13.pptVIP

Corporations: Paid-inCapital and the Balance Sheet Chapter 13 Objective 1 Characteristics separate legal entity continuous life and transferability of ownership no mutual agency limited liability of stockholders separation of ownership and management corporate taxation government regulation Organizing a Corporation The process of creating a corporation begins when the organizers (incorporators) obtain a charter from the state. The charter authorizes the corporation to issue stock and conduct business in accordance with state law and the corporation’s bylaws. Organizing a Corporation Stockholders elect the board of directors. The board sets policy, appoints the officers, and elects a chairperson. The board also designates the president, who is the chief operating officer. Authority Structurein a Corporation Capital Stock Corporate ownership is evidenced by a stock certificate which may be for any number of shares. The total number of shares authorized is limited by charter. Stockholders’ Equity Stockholders’ Equity Example Stockholders’ Equity Example Stockholders’ Rights The ownership of stock entitles stockholders to four basic rights, unless specific rights are withheld by agreement. Vote Dividends Liquidation Preemption Classes of Stock Common stock is the most basic form of capital stock. Preferred stock gives its owners certain advantages over common stockholders. Classes of Stock What is par value? It is an arbitrary amount assigned to a share of stock. Most companies set the par value of their common stock quite low to avoid legal difficulties from issuing their stock below par. Classes of Stock No-par stock does not have a par value. Some have a stated value. Stated value is an arbitrary value assigned to a share of common stock. This is similar to par value. Objective 2 Issuing Stock Example On January 13, Martin Corporation, which manufactures skateboards, issues 10,000 shares of common stock for $10 per share. Issuing Stock Example Issuing Stock Exampl