SIE Exam Question 214: Answer and Explanation

Question: 214

What is stock that has been authorized for sale and sold to investors (regardless of its current ownership) considered to be?

• A. Issued stock
• B. Authorized stock
• C. Treasury stock
• D. Outstanding stock

Correct Answer: A

Explanation:

Stock that is authorized for sale and sold to investors is issued stock, regardless of whether it still remains with investors or has subsequently been repurchased by the corporation. Authorized stock is the largest number of shares that can be sold by the corporation. Treasury stock is the stock that has been sold to the public and then repurchased by the corporation. Outstanding stock is stock that has been sold to investors and still remains with investors, having not been repurchased by the issuing corporation.