February 2007
Intermediate to advanced
288 pages
6h 32m
English
book
Crash Course in Accounting and Financial Statement Analysis, Second Edition
by Matan Feldman, Arkady Libman
Content preview from Crash Course in Accounting and Financial Statement Analysis, Second Edition
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Common Stock
One way companies choose to raise money (for growth, acquisitions, etc.) is through the sale (issuance) of shares of its stock.[3] Each share of stock represents a fractional ownership in companies, allowing people who purchased them to become (on a small scale) corporate owners, that is, shareholders.
[3] See Appendix for further discussion of the process of stock sale.
Common stock is a fractional unit of equity ownership in companies:
Issued shares of common stock are recorded at their nominal (fractional or par) value:
Example: $0.10/share, $0.50/share.
Par value is not market value of shares (share price).
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