Question

the li group had 202,000 shares of common stock outstanding at january 1, 2024. the following activities affected common shares during the year. there are no potential common shares outstanding.

Answer 1

The minimum number of investors needed to change the company's top management is 4. If investors 1 and 2 vote together, they cannot be certain of always getting their way.

Step-by-step explanation:

The minimum number of investors it would take to vote to change the company's top management can be determined by finding the cumulative number of shares owned by investors until the ownership exceeds 50% of the total outstanding shares. In this case, the total outstanding shares are 100,000. Starting from the largest shareholder, investor 1, we add up the number of shares owned until the ownership exceeds 50%.

Investor 1 owns 20,000 shares.
Investor 2 owns 18,000 shares. Total: 38,000 shares.
Investor 3 owns 15,000 shares. Total: 53,000 shares.
Investor 4 owns 10,000 shares. Total: 63,000 shares.

Therefore, it would take a minimum of 4 investors (Investor 1, Investor 2, Investor 3, and Investor 4) to vote to change the company's top management.

If investors 1 and 2 agree to vote together, they cannot be certain of always getting their way in how the company will be run because the combined ownership of Investor 1 (20,000 shares) and Investor 2 (18,000 shares) is 38,000 shares, which is less than 50% of the total outstanding shares.