ACG 2021 Lecture Notes - Lecture 10: Model Business Corporation Act, Initial Public Offering, Sole Proprietorship

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amberbuffalo985

15 Dec 2017

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Paid-in capital: the amount stockholders have invested in the company. Retained earnings: the amount of earnings the corporations has kept or retained-that is, the earnings not paid out in dividends. Treasury stock: the corporation"s own stock that it has reacquired. Invested capital: the amount of money paid into a company by its owners. Corporation: an entity that is legally separate from its owners and even pays its own income taxes. Model business corporation act: serves as a guide to states in the development of their corporate status. Articles of incorporation: corporate charter, describe a) the nature of the firm"s business activities, b) the shares of stock to be issued, and c) the initial board of directors. Organization chart: tracing the line of authority for a typical corporation. Angel investors: are wealthy individuals in the business community willing to risk investment funds on a promising business venture.

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Match the items below by selecting the appropriate number in thespace provided.

Net income retained in the corporation.
The amount that must be retained in the business for theprotection of creditors.
Preferred stockholders have a right to receive current andunpaid prior-year dividends before common stockholders receive anydividends.
Creditors only have corporate assets to satisfy theirclaims.
Responsible to stockholders for corporate activity.
The amount assigned to each share of stock in the corporatecharter.
Unit of ownership in a corporation.
Enables stockholders to maintain their same percentageownership when new shares are issued.
Corporation's own stock that has been reacquired by thecorporation but not retired.
Total amount paid-in on capital stock.

1.	Limited liability
2.	Capital stock
3.	Board of directors
4.	Paid-in capital
5.	Retained earnings
6.	Preemptive right
7.	Par value
8.	Legal capital
9.	Treasury stock
10.	Cumulative feature

pearzebra975

Match the items below by entering the appropriate answer letter choice from the column provided on the right.

	1.Net income retained in the corporation.
	2. Creditors cannot go after stockholderâs personal assets to satisfy their claims.
	3. Retained earnings currently unavailable for dividends.
	4. A corporationâs own stock that has been reacquired by the corporation.
	5. Responsible to stockholders for corporate activity.
	6. The amount assigned to each share of stock in the corporate charter.
.	7. The date the board of directors formally declares the dividend and announces it to stockholders.
	8. A debit balance in retained earnings.
	9. Capital contributed by stockholders.
	10. The death of a stockholder or employee does not affect the going concern of the corporation.
	11. The company determines ownership of the outstanding shares for dividend purposes.
	12. Unit of ownership in a corporation.
-	13. This type of dividend for the stockholder results in more shares of stock, but no change in ownership interest.
	14. The issuance of additional shares of stock to stockholders accompanied by a reduction in the par or stated value per share. This stock transaction does not require an accounting entry.
	15. The acts of the owners (stockholders) do not bind the corporation.

A.	Par value
B.	Record date
C.	Retained Earnings
D.	Indefinite life
E.	Treasury stock
F.	Stock split
G.	Declaration date
H.	Retained Earnings restrictions
I.	Stock dividend
J.	Capital stock
K.	Deficit
L.	Paid-in capital
M.	Cash dividend
N.	Board of directors
O.	Separate legal entity
P.	Limited liability

lilachorse885

Problem 17-46 (LO. 3)

Gull Corporation, a cash method, calendar year C corporation,was formed and began business on November 1, 2017. Gull incurredthe following expenses during its first year of operations(November 1, 2017âDecember 31, 2017):

Expenses of temporary directors and organizationalmeetings	$21,000
Fee paid to state of incorporation	3,000
Expenses for printing and sale of stock certificates	11,000
Legal services for drafting the corporate charter andbylaws (not paid until January 2018)	19,000

a. Assuming that Gull Corporation elects underÂ§ 248 to expense and amortize organizational expenditures, whatamount may be deducted in 2017?

Round the per-month amount to two decimal places. Round thefinal answer to the nearest dollar.

Gull Corporation's deduction for 2017 is $.

b. Assume the same facts as above, except thatthe amount paid for the legal services was $28,000 (instead of$19,000). What amount may be deducted as organizationalexpenditures in 2017?
$

ACG 2021 Lecture Notes - Lecture 10: Model Business Corporation Act, Initial Public Offering, Sole Proprietorship

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