Question

multiple choice question

when a corporate charter does not specify a legal value per share, then the stock issued is referred to as _______

no-par value stock
paid-in capital
treasury stock
par value stock

Explanation:

Analyze the definition of legal value per share

The question asks for the term used when a corporate charter does not specify a legal value per share (which is known as par value).

Evaluate the given options

• no-par value stock: This is stock issued without a specified par value in the corporate charter.
• paid-in capital: This represents the total amount of cash or other assets contributed to the corporation by shareholders in exchange for capital stock.
• treasury stock: This is a corporation's own stock that has been issued, fully paid for, and reacquired by the corporation but not retired.
• par value stock: This is stock that has been assigned a specific legal value per share in the corporate charter.

Select the correct term

Since the charter does not specify a legal value per share, the stock is referred to as no-par value stock.

Answer:

• no-par value stock (Correct answer)
• paid-in capital
• treasury stock
• par value stock