Stockholders Equity Flashcards
1
Q
Additional Paid-In-Capital is…
A
What shareholders were willing to pay in excess of Par/stated value to acquire shares
2
Q
Retained earnings is….
A
Cumulative net income of the corp from the date of the incorporation after you deduct dividends.
3
Q
Par value
A
Stated value
Report total par or stated value for all shares issued and outstanding
Par = Legal capital of the corporation
Provides minimum basic protection for creditors
Most states are NOT allowed to pay dividends out of par value
