Question

The corporate charter of Gage Corporation allows the issuance of a maximum of 100,000 shares of common stock. During its first 2 years of operation, Gage sold 70,000 shares to shareholders and reacquired 4,000 of these shares. After these transactions, how many shares are authorized, issued, and outstanding?

Answer 1

Authorized : 100,000

Issued : 66,000

Outstanding: 34,000

Step-by-step explanation:

Authorized shares refers to the number of shares approved by the board for issue. A company is not permitted to issue shares above it's authorized shares.

Issued shares refers to shares offered to shareholders.

Outstanding shares are shares not yet subscribed by shareholders.