3.1 Differentiate types of stocks issued by corporations.
The team concluded that the different types of stocks issued by a corporation are common stock, preferred stock, and treasury stock. Everyone is aware that common stock gives stockholders the right to vote on actions dealing with corporate earnings through the acquisition of dividends, and keeping the same percentage of shares when new stocks are issued. Preferred stocks are additional class of stocks issued by corporations to appeal to more investors. Treasury stock is stock that a company has issued, and then reacquires. Though everyone is aware of what types of stocks are issued by corporations, there are still some areas where team members expressed still being confused. One of those areas of concern deals with authorized stock and why companies do not put a par value on a stock to determine its value. Another area of confusion deals with treasury stock and grasping the concept. In relation to each member’s organization and the issuance of stock, everyone expect for one team member works for a non-profit organization or a company that does not issue stock. The one member, however, works for an airline and expressed that the company, United Airlines, has common and treasury stocks (United Continental Holdings, Inc., 2010).
3.2 Calculate stocks, dividends, and stock splits.
For objective 3.2, some team members seem to understand better than others, what is involved in the calculation of stocks, dividends, and stock splits. Stock is calculated by subtracting the dividends of a certain stock from the company's net income, then dividing that number by the number of outstanding shares. To calculate dividends multiply the number of shares by the annual dividend to find out how much the dividend payment will be, find the yield on investment a dividend payment represents by multiplying the dividend by the amount paid per share of stock, Calculate the dividend-payment ratio, and...