Accountancy Problems; With Solutions Volume 2

This historic book may have numerous typos and missing text. Purchasers can usually download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1911 edition. Excerpt: ...to prove, of course, that he had no notice of the fraud involved in the transaction. In the absence of fraud, the vendor of a forged certificate cannot be held by the vendee. (See Cook on Corporations, Sections 291-8.) 33. What is a joint stock company? In what ways can it be compared with (a) a partnership, (b) an incorporated company? Answer. The Cyclopedia of Law and Procedure defines a joint stock company as follows: "A joint stock company is an association of individuals for purposes of profit, possessing a common capital contributed by the members composing it, such capital being commonly divided into the shares, of which each member possesses one or more, and which are transferable by the owner." (For a history of joint stock companies, see 5 Albany Law Journal 19.) The distinction between a joint stock company and a partnership, and between a joint stock company and an incorporated company, is indicated in answer to question 11. 34. Define treasury stock. What effect has the term "fully paid and non-assessable," written upon a stock certificate, in respect to the liability of stockholders to creditors of the company? Explain. Answer. Treasury stock is sometimes used to indicate stock which has not been issued, but the weight of authority is to the effect that treasury stock is stock which has been issued and finds its way back to the treasury of the company through purchase, gift, forfeiture or otherwise. For the answer to the second part of this question, see answer to question 7. 35. What is corporate stock, and how does it differ from bonds issued by a corporation? Answer. By corporate stock is meant the undivided shares of interest which the stockholders have in the corporation. It represents ownership in...