Authorized stock
Authorized stock refers to the amount of stock that a corporation is authorized to sell as indicated in its charter. The total amount of authorized stock at the time of incorporation normally anticipates both initial and subsequent capital needs. As a result, the number of shares authorized generally exceeds the number initially sold. If it sells all authorized stock, a corporation must obtain consent of the state to amend its charter before it can issue additional shares.
Category: Accounting & Auditing
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