5. Finance Flashcards

You may prefer our related Brainscape-certified flashcards:
1
Q

What are the different types of shares?

A

Issued shares
- Shares issued by Corporation

Outstanding shares

  • [Issued shares] LESS [Treasured shares]
  • Voting rights

Treasured shares

  • Issued shares repurchased by Corporation
  • NO voting rights
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2
Q

What is the difference between debt and equity?

A

Debt
- NO ownership by Corp

Equity
- Ownership by Corp

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3
Q

What type of debts are there?

A

Bonds
- Secured

Debenture
- NOT secured

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4
Q

What type of equity is there?

A

Sold

  • Issued shares
  • Outstanding shares

Reacquired (redemption/reacquired)

  • Authorised shares
  • NOT issued shares
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5
Q

How are value of shares determined?

A

By directors (as they deem appropriate) (RMBCA)

Par value (Articles)
- Generally eliminated by RMBCA
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6
Q

What is required for consideration to pay equities?

A

1) At Directors’ request
2) NOT discriminatory
3) Tangible/Intangible
4) Beneficial to Corporation

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7
Q

What happens if SH fails to pay consideration for equities?

A

Liable for unpaid amount

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8
Q

What is required for shareholder to exercise their pre-emptive rights?

A

1) Authorised by Articles
2) Issued in cash
3) Issued at least 6 months after incorporation
4) SH has voting rights

=> SH can purchase at same % ownership in corporation

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