What is a stock split? Definition of Stock Split A stock split usually refers to a corporation dividing its existing number of shares of common stock into a greater number of shares. For instance, a corporation with...
What is a stock split? Definition of Stock Split A stock split usually refers to a corporation dividing its existing number of shares of common stock into a greater number of shares. For instance, a corporation with...
A stock split, such as a 2-for-1, means that every stockholder will have twice as many shares as was held previously. Accordingly, the market price per share after the split should be one-half of the market price...
What are the journal entries for a stock split? Definition of a Stock Split A stock split usually increases the number of shares of a corporation’s common stock with the intention of reducing the market price of each...
The following entry for a stock split is an example of a memorandum entry: “On June 7, 2023 a 2-for-1 stock split was declared for the common stockholders of record as of the end of the day on June 28, 2023. The stock...
Our Explanation of Stockholders' Equity covers the unique terminology for a corporation's paid-in capital, retained earnings, treasury stock, and accumulated other comprehensive income. Included are cash dividends, stock...
An entry without debit or credit amounts. For example, assume that a corporation has 100,000 shares of $0.50 par value common stock before a 2-for-1 stock split. At the time of the split a memo entry would be entered in...
, liabilities, and stockholders’ equity do not change. The journal entry to record the declaration of a stock dividend will usually debit Retained Earnings for the market value of the new shares and will credit the...
__________ income is to be reported as a separate component of stockholders’ equity. 22. A disadvantage of the regular corporation (not an S-corporation) as a form of business involves income __________. 23. A...
of stockholders' equity, there is no change in the total amount of stockholders' equity. 19. When a corporation declares a 2-for-1 stock split, what will be the change in the total amount of stockholders’...
-in capital. MARKET MREATK Unscramble MARKET KARETM Unscramble 9. A 100% stock dividend will provide stockholders with the same number of shares as a 2-for-1 stock _________. SPLIT TSIPL Unscramble SPLIT TPLIS Unscramble...
number of shares after a 3-for-2 stock split or after a __________ 50%% stock dividend. 21. A corporation's own shares of stock that have been reacquired from its stockholders but have not been retired are called...
. Mark as wrong Mark as right stock split This and a stock dividend are declared by a corporation in order to increase the number of shares of common stock and thereby reduce the market price per share. stock split This...
The point at which several products emerge from a common process.
the common process is known as the split-off point. The costs prior to the split-off point are known as the common costs. Since the value of the byproducts is usually insignificant, the accounting for the byproducts can...
. The benefit foregone by choosing another course of action is known as the __________ cost. 8. A separable cost occurs __________ the split-off point. Select... after before 9. The allocation of joint costs at the...
The products with significant value that emerge at a split-off point in a process. When a joint product has little value it is referred to as a by-product.
What is preferred stock? Definition of Preferred Stock Preferred stock is a type of capital stock issued by some corporations in addition to its common stock. Preferred stock is also known as preference stock. The word...
What is safety stock? Definition of Safety Stock Safety stock is an additional quantity of an item held by a company in inventory in order to reduce the risk that the item will be out of stock. Safety stock acts as a...
Paper evidence of ownership in a corporation. The certificate would indicate the type of stock (common, preferred), any restrictions pertaining to the sale of the stock, the number of shares, the par value, etc. Today,...
What is callable stock? Callable stock is an ownership interest (shares) in a corporation that can be “called in” by the corporation at a specified price. For example, a corporation might issue 9% $100 Preferred...
Preferred stock where past, omitted dividends do not have to be paid before a dividend can be paid to common stockholders. In the case of noncumulative preferred stock, only its current year dividend needs to be paid in...
The stockholders’ equity account which reports the par value of the preferred shares of stock that have been issued. Amounts received that are greater than the par value are recorded in Paid-in Capital in Excess of...
A corporation’s own stock that has been repurchased from stockholders. Also a stockholders’ equity account that usually reports the cost of the stock that has been repurchased.
The type of stock that is present at every corporation. (Some corporations have preferred stock in addition to their common stock.) Shares of common stock provide evidence of ownership in a corporation. Holders of common...
A heading that includes common stock and preferred stock.
See paid-in capital in excess of par value – preferred stock.
A right to buy a specific number of shares of stock at a specific price by a specific date.
What is treasury stock? Definition of Treasury Stock Treasury stock is usually a corporation’s previously issued shares of common stock that have been purchased from the stockholders, but the corporation has not...
An additional quantity of items held in inventory in order to minimize the chance of an item being out of stock.
Preferred stock where the dividend could be more than the original, stated dividend.
This term is associated with preferred stock that does not allow its holders to receive more than its stated dividend. The nonparticipating feature is typical in preferred stock. To learn more about preferred stock, see...
A dividend in the form of more shares of stock. A 5% stock dividend means that a stockholder holding 100 shares would receive 5 additional shares of stock. Since all shareholders receive additional shares, each...
A class of corporation stock that provides for preferential treatment over the holders of common stock in the case of liquidation and dividends. For example, the preferred stockholders will be paid dividends before the...
The stockholders’ equity account that reports the par or stated value of the issued shares of common stock. If the common stock does not have a par or stated value, this account will report the amount received when...
What is common stock? Definition of Common Stock Common stock refers to the shares of ownership interest in a U.S. corporation. The owners of the common stock are referred to as common stockholders, common shareholders,...
Stock without a par value.
This preferred stock feature assures the owner that any omitted dividends on this stock will be made up before the common stockholders will receive a dividend. Any omitted dividends on cumulative preferred stock are...
What is capital stock? Definition of Capital Stock Capital stock refers to the shares of ownership that have been issued by a corporation. The amount received by the corporation when its shares of capital stock were...
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