Financial Accounting I

study guides for every class

that actually explain what's on your next test

Issued shares

from class:

Financial Accounting I

Definition

Issued shares are the total number of a company's shares that have been sold and are held by shareholders. These shares include both outstanding shares and treasury shares.

5 Must Know Facts For Your Next Test

  1. Issued shares represent ownership in the company and can be common or preferred stock.
  2. The number of issued shares cannot exceed the number of authorized shares specified in the company's charter.
  3. Treasury shares are those that were issued and later reacquired by the company.
  4. Issued shares impact the calculation of earnings per share (EPS) as they determine the denominator in this ratio.
  5. The process of issuing shares involves steps like board approval, regulatory compliance, and setting an issue price.

Review Questions

  • What is the difference between issued shares and authorized shares?
  • How do issued shares affect earnings per share (EPS)?
  • What are treasury shares, and how do they relate to issued shares?
© 2024 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.
Glossary
Guides