The Number of Shares of Authorized Stock of a Corporation

question 116

Multiple Choice

The number of shares of authorized stock of a corporation:

• A)changes every time stock is sold.
• B)is stated in the charter.
• C)has no limit.
• D)must be recorded as a journal entry.

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Definitions:

Treasury Stock

Shares of a company's own stock that it has reacquired and held in the company's treasury.

Cost Per Share

The price at which a company's shares were initially offered to the public or the current market value of a share.

Stockholders' Equity

Represents the owners' residual interest in a corporation's assets after deducting liabilities.

Buy Back

A corporate action in which a company repurchases its own shares from the marketplace.