When the board of directors authorizes a cash dividend?

Who has the authority to declare a cash dividend?

The board of directors has full authority to determine the amount of income to distribute in the form of dividends. Dividends are not a liability until they are declared.

When stock is cumulative preferred stock and the board of directors does not declare a dividend the unpaid dividend amount is called?

When stock is cumulative preferred stock and the board of directors does not declare a dividend, the unpaid dividend amount is called: dividend in arrears. Blink, Inc. has 1,000 shares of $10 par, 5% preferred stock, and 20,000 shares of $10 par common stock issued and outstanding.

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When a state authorizes the sale of stock to stockholders The Corporation will credit retained earnings for the par value of the stock?

When a state authorizes the sale of stock to stockholders, the corporation will credit Retained Earnings for the par value of the stock. 6. When a corporation fails to pay a dividend one year on its common stock, it is said to be “in arrears.”

Is a document that gives a designated agent the right to vote the stock?

proxy

What 3 conditions must be met before a cash dividend is paid?

What three conditions must exist before a cash dividend is paid? To pay a cash dividend, a company must have earnings or retained earnings because normal cash dividends are a distribution of earnings. Second, a company must have adequate cash to fund the payment of dividends.

Can you declare a dividend and not pay it?

If you have some of your tax-free personal allowances or basic rate tax band left and your company has enough profits, and for whatever reason you don’t want to pay yourself the cash dividend now, you can still declare a dividend as immediately payable and book an entry in your director’s loan account.

When a corporation purchases its own stock in the market they are called?

when a corporation purchases its own stock, the stock purchased is called … stock. treasury. purchasing treasury stock is a. asset use transaction.

What authority determines how many shares of stock a corporation may issue?

board of directors

When a corporation purchases shares of its own stock it is called?

Corporations purchase and hold their own stock, known as treasury stock, for several reasons. Identify which of the following is not a reason that a corporation would buy treasury stock. To reduce the market value of the common shares outstanding.

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What happens if no par value stock does not have a stated value A?

The par value of common stock must always be equal to its market value on the date the stock is issued. 10. When no-par value stock does not have a stated value, the entire proceeds from the issuance of the stock becomes legal capital.

What happens if no par stock is issued without a stated value?

What happens if no-par stock is issued without a stated value? The entire proceeds are credited to common stock.

What is one major difference between a stock split and a stock dividend?

In the case of a stock split, each old share is split into a number of new shares with a reduced par value, leaving the total share capital unchanged. In the case of a stock dividend, a number of new shares are received for each share owned.

How is preferred stock recorded?

To comply with state regulations, the par value of preferred stock is recorded in its own paid-in capital account Preferred Stock. If the corporation receives more than the par amount, the amount greater than par will be recorded in another account such as Paid-in Capital in Excess of Par – Preferred Stock.

How do you split stock in accounting?

Stock splits are events that increase the number of shares outstanding and reduce the par or stated value per share. For example, a 2-for-1 stock split would double the number of shares outstanding and halve the par value per share.

When business incorporates must be filed?

Terms in this set (73) ____________ capital is the amount of money paid into a company by its owners. A business that incorporates must file a document with the state, which includes a description of the business activities, the shares to be issued, and the composition of the board of directors.

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