ACCT 2101: TEST 4
28 Cards in this Set
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authorized number of shares
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maximum number of shares of a corporations capital that can be issued as specified in the charter
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common stock
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basic voting stock issued by a corporation
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cumulative dividend preference
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preferred stock feature that requires current dividends not paid in full to accumulate for every year in which they are not paid. must be paid before any common dividends can be
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current dividend preference
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the feature of preferred stock that grants priority to preferred dividends over common dividends
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declaration date
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date on which the board of directors officially approves a dividend
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dividends in arrears
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dividends on cumulative preferred stock that have not been paid in prior years
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issued shares
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total number of shares of stock that have been sold. shares outstanding + treasury shares held
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legal capital
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permanent amount of capital defined by state law that must remain invested in the business
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no par value stock
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capital stock that has no par value specified in the corporate charter
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outstanding shares
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total number of shares of stock that are owned by stockholders on any partcular date
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par value
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nominal value per share of capital stock established by the board of directors. serves as the basis for legal capital.
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payment date
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date on which a cash dividend is paid to the stockholders of record
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preferred stock
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stock that has specified rights over common stock
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record date
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date on which the corporation prepares the list of current stockholders as shown on its records
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stock dividend
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distribution of additional shares of a corporations own stock
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stock split
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increase in the total number of authorizes shares by a specific ration, does not decrease retained earnings
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treasury stock
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corporations own stock that has been issued but subsequently reacquired and is still being held by that corporation
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amortized cost method
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reports investments in debt securities held to maturity at cost minus any premium or plus any discount
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Equity Method
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used when an investor can exert significant influence over an affiliate; the method permits recording the investor's share of the affiliate's income
20-50% of shares
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fair value method
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reports securities at their current market value
<20%
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goodwill
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excess of the purchase prices of a business over the fair value of the acquired business' assets and liabilities
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held to maturity investments
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investments in debt securities that management has the ability and intent to hold until maturity
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investment in affiliates
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investments in stock held for the purpose of influencing the operating and financing strategies of the entity for the long term
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merger
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occurs when one company purchases all of the net assets of another and the acquired company goes out of existence
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purchase method
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records assets and liabilities acquired in a merger of acquisition at their fair value on the transaction date
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securities available for sale
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all passive investments other than trading securities and debt held to maturity (short or long term)
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trading securities
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all investments in stock or bond that are held primarily for the purpose of active trading in the near future (short term)
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unrealized holding gains or losses
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amounts associated with the price changes of securities that are currently held
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ACCT 2101: TEST 1