The contents of this chapter include all of the following: Describe the balance sheet in terms of equity and debt capital and producing and operating assets, explain the concept of net income, who owns it and what they can do with it, define the three major activities of a business,. | Corporation: Dividends, Retained Earnings, Income Reporting and Shareholders Equity PART II: Corporate Accounting Concepts and Issues Lecture 16 Discuss the characteristics of the corporate form of organization. Identify the key components of stockholders’ equity. Explain the accounting procedures for issuing shares of stock. Describe the accounting for treasury stock. Explain the accounting for and reporting of preferred stock. Describe the policies used in distributing dividends. Identify the various forms of dividend distributions. Explain the accounting for small and large stock dividends, and for share splits. Indicate how to present and analyze stockholders’ equity. Learning Objectives Issuance of stock Reacquisition of shares Preferred Stocks The Corporate Form Equity Retained Earnings Dividend Policy Presentation and Analysis Corporate law Capital stock or share system Variety of ownership interests Retained earnings restrictions Prior period adjustments Retained earnings . | Corporation: Dividends, Retained Earnings, Income Reporting and Shareholders Equity PART II: Corporate Accounting Concepts and Issues Lecture 16 Discuss the characteristics of the corporate form of organization. Identify the key components of stockholders’ equity. Explain the accounting procedures for issuing shares of stock. Describe the accounting for treasury stock. Explain the accounting for and reporting of preferred stock. Describe the policies used in distributing dividends. Identify the various forms of dividend distributions. Explain the accounting for small and large stock dividends, and for share splits. Indicate how to present and analyze stockholders’ equity. Learning Objectives Issuance of stock Reacquisition of shares Preferred Stocks The Corporate Form Equity Retained Earnings Dividend Policy Presentation and Analysis Corporate law Capital stock or share system Variety of ownership interests Retained earnings restrictions Prior period adjustments Retained earnings statement Financial condition and dividend distributions Types of dividends Stock split Disclosure of restrictions Stockholders’ Equity Presentation Stockholders’ Equity Analysis Income Statement Presentation Income Statement Analysis Stockholders’ Equity Three primary forms of business organization The Corporate Form of Organization Proprietorship Partnership Corporation LO 1 Discuss the characteristics of the corporate form of organization. Special characteristics of the corporate form: Use of capital stock or share system. Development of a variety of ownership interests. Capital Stock or Share System The Corporate Form of Organization LO 1 Discuss the characteristics of the corporate form of organization. In the absence of restrictive provisions, each share carries the following rights: To share proportionately in profits and losses. To share proportionately in management (the right to vote for directors). To share proportionately in assets upon liquidation. To share proportionately in
