Questions from Financial Accounting

Q: What is a corporate charter?

What is a corporate charter?

Q: Explain each of the following terms: (a) authorized shares

Explain each of the following terms: (a) authorized shares, (b) issued shares, and (c) outstanding shares.

Q: Differentiate between common stock and preferred stock.

Differentiate between common stock and preferred stock.

Q: Explain the distinction between par value and no-par value stock

Explain the distinction between par value and no-par value stock

Q: Define additional paid-in capital.

Define additional paid-in capital.

Q: Explain the difference between contributed capital and earned capital. How is

Explain the difference between contributed capital and earned capital. How is each represented in the stockholders’ equity section of a company’s balance sheet?

Q: Assume that you are a financial analyst for a large investment banking

Assume that you are a financial analyst for a large investment banking firm. You are responsible for analyzing companies in the retail sales industry. You have just learned that a large West Coast ret...

Q: Define treasury stock. Why do corporations acquire treasury stock?

Define treasury stock. Why do corporations acquire treasury stock?

Q: How is treasury stock reported on the balance sheet? How is

How is treasury stock reported on the balance sheet? How is the “gain or loss” on the resale of treasury stock reported on the financial statements?

Q: What are the two basic requirements to support the declaration of a

What are the two basic requirements to support the declaration of a cash dividend? What are the effects of a cash dividend on assets and stockholders’ equity?