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Chapter11Corporations:Organization,StockTransactions,Dividends,andRetainedEarningsFinancialAccounting,SeventhEdition
CHAPTER11-Part1SO1Identifythemajorcharacteristicsofacorporation.MajorCharacteristicsofacorporationFormingacorporationStockholders’Rights
Identifythemajorcharacteristicsofacorporation.Recordtheissuanceofcommonstock.Explaintheaccountingfortreasurystock.Differentiatepreferredstockfromcommonstock.Preparetheentriesforcashdividendsandstockdividends.Identifytheitemsthatarereportedinaretainedearningsstatement.Prepareandanalyzeacomprehensivestockholders’equitysection.LearningObjectives
Anentityseparateanddistinctfromitsowners.TheCorporateFormofOrganizationClassifiedbyPurposeandNot-for-ProfitForProfitClassifiedbyOwnershipPubliclyheldPrivatelyheldWendy’sFordMotorCompanyCokeAmazonHopelinkSusanBKomenBillMelindaGatesFoundationMars(theSnickersCo.
SeparateLegalExistenceLimitedLiabilityofStockholdersTransferableOwnershipRightsAbilitytoAcquireCapitalContinuousLifeCorporateManagementGovernmentRegulationsAdditionalTaxesSO1Identifythemajorcharacteristicsofacorporation.AdvantagesDisadvantagesTheCorporateFormofOrganizationCharacteristicsthatdistinguishcorporationsfromproprietorshipsandpartnerships.
______________________________________________TheStockholdersSeparateLegalExistence-Adv
Stockholdersareseparatefromthecompany.Theword“corporation”comesfromtherootwork“corpus”orbody.Acorporationisaseparatelegalentity.
TheCorporation______________________________________________TheStockholders–$$$$$$$$$$$$$$$$$$$BUT:Thestockholders’personalassetsareNOTatrisk.LimitedLiabilityofStockholders-Adv
StockholderareatriskONLYtotheextentoftheirinvestment.Inotherwords,astockholdercaneithermakemoneyonhis/herstock(ifthepricerises)or….worstcasescenario,LOSEITALL.But
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