All corporations are authorized to issue stock to investors,
whether the corporation is publicly traded or not. A stockholder
is generally assigned a percentage of ownership in the company,
based on the percentage of stock he owns. There is a difference
between the number of shares a company is authorized to issue
and the number of shares actually issued. When you issue stock
to shareholders, you must adjust two accounts on your balance
sheet to record the transaction. Authorized Vs. Issued Stock The
amount of stock you issue differs from the amount of stock your
company is authorized to issue. When you establish a
corporation, the number of shares your business is authorized to
issue is listed on your Articles of Incorporation filed with the
state where you transact business. When shares are actually
issued, the remaining number of shares your company is
authorized to issue decreases. Authorized shares may be reported
on the balance sheet. However, reporting the authorized, but
unissued, shares of stock serv