Stockholders' Equity

This set of flashcards covers key concepts related to stockholders' equity as presented in Chapter 10 of Financial Accounting.

Corporation

A separate legal entity that is owned by stockholders and continues to exist independently of its owners.

Limited Liability

A legal structure where the owners' personal assets are protected from the debts and liabilities of the corporation.

Double Taxation

The taxation of corporate income at both the corporate level and again as dividends are paid to shareholders.

Treasury Stock

Shares that were once a part of the outstanding shares of a company, but were later repurchased by the company.

Retained Earnings

The accumulated net income that a corporation retains for reinvestment rather than distributing as dividends.

Common Stock

The basic form of stock that represents ownership in a corporation and comes with voting rights.

Preferred Stock

A type of stock that provides dividends before common stockholders and has priority in asset liquidation.

Stock Dividend

A distribution of additional shares to existing stockholders rather than a cash payment.

Stock Split

An increase in the number of outstanding shares of a company, which decreases the par value but not the total equity.

Paid-in Capital

Total amount that shareholders have invested in the company beyond the par value of the stock.

Accumulated Other Comprehensive Income

Income that includes unrealized gains and losses not included in the net income calculation.

Outstanding Stock

Shares of a corporation that are held by investors, excluding treasury stock.

Authorized Stock

The maximum number of shares that a corporation is legally allowed to issue as per its charter.

Issued Stock

The number of shares that have been sold to and are held by shareholders.