Question

The charter of Vista West Corporation specifies that it is authorized to issue 214,000 shares of common stock. Since the company was incorporated, it has sold a total of 146,000 shares (at $16 per share) to the public. It has bought back a total of 19,000. The par value of the stock is $5. When the stock was bought back from the public, the market price was $20.
Required:
1. Determine the authorized shares.
2. Determine the issued shares.
3. Determine the outstanding shares.

Answer 1

Answer:

Requirement 1: 214,000

Requirement 2: 146,000

Requirement 3: 127,00

Explanation:

Requirement 1:

Authorized shares: The maximum number of shares a company can issue are called authorized shares.They include both ordinary and preference shares. Here Visa West Corporation can issue 214,000 shares.

Requirement 2:

Issued shares: The number of shares the company has to issue to publicly

Here Visa West issued 146,000 shares to he public

Requirement 3:

Outstanding shares: The number of shares that need to be paid a dividend are Outstanding shares. Here Visa West Corporation has 127000(146000-19000) outstanding shares .