Common Stock
A corporation has 10 million authorized shares, 8 million issued shares, and 1 million shares held as treasury stock. How many shares are outstanding?
Outstanding shares equal issued shares minus treasury stock: 8 million - 1 million = 7 million outstanding shares. Authorized shares represent the maximum that could be issued but are not part of this calculation. Treasu
Complete Analysis & Legal Rationale
Outstanding shares equal issued shares minus treasury stock: 8 million - 1 million = 7 million outstanding shares. Authorized shares represent the maximum that could be issued but are not part of this calculation. Treasury stock has been repurchased and is no longer outstanding.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Matches the verified teaching point in the explanation.
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.