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Describe
stocks? Describe each. each. (More than 10)
Capital - Capital refers to financial assets or the financial 1) Par value shares - Shares with a value fixed in the articles of
value of assets, such as funds held in deposit accounts, as incorporation and the certificates of stock. The par value fixes
well as the tangible machinery and production equipment the minimum issue price of the shares.
used in environments such as factories and other
manufacturing facilities. Additionally, capital includes Note: A corporation cannot sell less than the par value but a
facilities, such as the buildings used for the production and shareholder may sell the same less than the par value because
storage of the manufactured goods. Materials used and it is his.
consumed as part of the manufacturing process do not
qualify.
Shares sold below its par value is called watered stocks.
Issued capital stocks - The total amount of a company's To put simply, these are shares reacquired by the corporation.
stock, both common and preferred, that has been issued They are called treasury shares because they remain in the
and represents the total capitalized value of the company. corporate treasury until reissued. More importantly, they have
Includes non-retired shares being held as Treasury stock. no:
8. Dividends-describe
9. Profits-describe
PROFIT DIVIDENDS
Profit is earned by the The dividend payment is a total
company during the year and management decision. in
dividend is distribution a simple words dividend
percentage of such profit. It is payment is not an obligatory
important to remember that requirement and management
company may have profitable may decided to reinvest the
operation but he still not profit instead of paying out.
paying dividend Dividend payment is normally
described as percentage of
nominal value.