Chapter 14 Flashcards
callable preferred
Preferred stock that can be repurchased by issuer for a preset price.
common stock
The residual equity interest in a corporation; last in liquidation but usually receiving the full benefits of any corporate growth.
convertible preferred
Preferred stock that can be exchanged for common stock at some preagreed ratio.
cumulative preferred
Preferred stock that is entitled to a periodic dividend, and those dividends must be paid (eventually) before any monies can be distributed to common stockholders.
dividends in arrears
An omitted dividend on cumulative preferred stock that must eventually be paid before any monies can be distributed to common stockholders.
ex-dividend
The event (date) when a transfer of stock ownership between shareholders will occur without the right for the purchaser to receive any previously declared dividends.
initial public offering
The first time stock in a corporation is offered to the investing public; registration and other requirements must be met; proceeds may flow to the corporation or private shareholders.
legal capital
Usually the par value of the stock of a corporation.
paid-in-capital in excess of par
The amount by which a stock’s issue price exceeds its par value; also referred to as “additional paid-in capital”.
preemptive right
A right that may or may not be provided to shareholders enabling them with a first right of refusal to buy any additional shares offered by a corporation.
preferred stock
A class of stock that generally benefits from a stipulated periodic dividend and priority in liquidation; but, usually lacking in upside participation in corporate growth.
prospectus
The documentation describing financial and business aspects of an initial public offering.
statement of stockholders’ equity
A financial statement that is often presented in lieu of a statement of retained earnings and other disclosures about equity accounts.
stock
Transferable units of ownership in a corporation.
stock dividend
A noncash corporate activity to provide shareholders with additional shares in proportion to existing ownership; makes for more shares outstanding, but does not change total equity.
