ADMS 2500 Chapter Notes - Chapter 14: Issued Shares, Preferred Stock, Cash Cash
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ADMS 2500 Full Course Notes
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Limited liability of shareholders: transferable ownership rights, ability to acquire capital, continuous life, corporate management professional managers, potential for deferred or reduced taxes. Disadvantages: corporate management separation of ownership & management, government regulations, potential for additional tax, pay federal and provincial tax & shareholders taxed on dividends. Share issue terms: authorized anticipated # of shares to meet the needs of the company included in company"s charter. Legal capital legal significance must be kept in the business for the protection of corporation"s creditors: today par or stated value either not required or prohibited in canada. 1st time shares offered to pubic is called an ipo (initial public offering: once shares issued, they then trade on the secondary market, when shares traded among investors, no impact on corporate financial position. See page 628 for more info regarding this section. Common shares xxx xxx: issued stated value shares for more than stated value.