Aviation Incorporated has 136,000 shares authorized, 126,000 shares issued and no treasury stock. Determine the number of shares outstanding
Added by Joan S.
Step 1
- Authorized shares are the maximum number of shares that a company can issue, which in this case is 136,000 shares. - Issued shares are the number of shares that have actually been sold or distributed to shareholders, which is 126,000 shares. - Treasury stock Show more…
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Q1. For AEO, the Par Value account is titled (Contributed Capital) and is $1 per share, while the Additional Paid-in-Capital account is titled (Common Stock). Q2. On January 29, 2011, $549,000 was reported as Common Stock (Par) and $93,000 was reported as Contributed Capital (APIC) for total contributions of $549,093 for issued shares. Q3. During FYE January 28, 2012, AEO repurchased common stock, which decreased total stockholders’ equity by $X thousand and reissued treasury stock which increased total stockholders’ equity by $X thousand. Upon incorporation, a company is authorized (by the state of incorporation) to issue a designated number of shares to investors. Sometimes corporations buy back shares of stock that have been issued; these are referred to as treasury stock. Outstanding shares are the total number of shares actually held by investors at a given time, equaling shares issued less shares of treasury stock. Q4. On January 29, 2011, for preferred stock, there are 600,000 thousand shares authorized, 5,000 thousand shares issued, and 5,000 thousand shares outstanding. Whereas for common stock on January 29, 2011, there are 249,566 thousand shares authorized, 194,366 thousand shares issued, and 194,366 thousand shares outstanding. Q5. On January 29, 2011, for common stock: 194,366 thousand shares issued – X thousand shares in treasury = 194,366 thousand shares outstanding. Q6. On January 29, 2011, there are 194,366 thousand shares of common stock issued for a total contribution of $938,023 thousand, averaging $17 per share. Also, there are X thousand shares of treasury stock with a total cost of $549,093 thousand, averaging $3 per share. Why does the average cost of issued common shares differ from the average cost of treasury shares?
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