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37 Cards in this Set

  • Front
  • Back
Authorized shares
The total number of shares the state has approved for a corporation to sell.
Budgeted (pro forma) statement of owners capital
A statement that indicates the anticipated changes in each partner's capital.
Callable preferred stock
Preferred stock that gives the issuing corporation the right to repurchase the preferred stock at a stipulated price.
Cash dividend
A cash distribution in the form of a check drawn on the coporation's bank account that is sent to each shareholder as of a certain date.
Common stock
The basic ownership unit of a corporation. Right to vote, right to declared dividends, right to residuall assets upon liquidation of the corporation, right to dispose of shares by sale or gift, and preemptive right.
Convertible preferred stock
Preferred stock that gives the shareholder the right to convert (exchange) the preferred shares for other forms of capital, as stated in the corporate charter, at the option of the preferred shareholder.
Cumulative preferred stock
Preferred stock that accumulates unpaid dividends over time.
Date of declaration
The date on which the board of directors announces its decision to pay a dividend. Sets the amount of the dividend and the date to distibute it. For cash and property dividends, corp. obligated to pay dividend on date of payment (liability).
Ex-dividend date
Last day to buy stock in order to receive dividend. Provides the lead time necessary to record the names of new shareholders in corporate records. Occurs 2 to 3 days prior to the date of record.
Date of record
Shareholders' names listed at this time on the secretary of the corporation's record will receive dividends declared on date of declaration.
Date of payment
Corporation pays dividends to shareholders of record.
Debt financing
When a company obtains funds (cash) in exchange for a liability to repay the borrowed funds.
Dividend reinvestment program (DRIP)
A program that allows current shareholders to use their cash dividends to buy more shares of the company's stock
Dividends in arrears
The amount of cumulative preferred stock dividends not paid in full when stipulated.
Equity financing
A means for a company to obtain funds in exchange for an ownership interest in the company.
Financial leverage
A financing strategy designed to increase the rate of return on the owners' investment than the cost of using the funds. Use "Debt-to Equity Ratio" (total liability/total owners' equity).
Financial risk
The chance that a company will fail because it defaults on its debt.
Issued shares
The number of authorized shares a corporation has sold to shareholders.
Legal capital
The portion of shareholders' equity required by state law to be retained for the protection of the coporation's creditors.
Market value
Price agreed to by a willing unrelated buyer and seller.
No-par, stated value stock
Stock with a minimum issue price or stated value established by the corporation's board of directors but no par value specified in the charter.
No-par stock
Stock that does not have a minimum price assigned to each share of stock.
Outstanding shares
The number of shares issued and held outside the corporation.
Par value
An arrbitrary value assigned to shares of capital stock that is approved by the state.
Participating preferred stock
Preferred stock that allows preferred s hareholders the right to receive an amount in excess of the stated dividend rate or amount.
Preemptive right
A right of common shareholders that allows them to maintain their percentage interest in the coporation when it issues new shares of common stock.
Preferred stock
An ownership interest in a coporatioin with special privileges or preferences as to liquidation and dividends. Upon liquidation, they are paid before common stockholders and entitled to receive dividends before common stockholders. In exchange, give up right to vote, dividends limited to set amount.
Property dividend
The distibution of specific noncash assets to the shareholders of a corporation.
Redeemable preferred stock
Preferred stock that allows a shareholder to turn in (redeem) the preferred stock for cash at the shareholder's option.
Retired shares
Repurchased issued shares that the corporation will never reissue.
Return on common equity ratio.
A ratio that measure the proportion of income available to provide a return for common shareholders.
Return on owner's equity ratio (ROE)
A ratio that measures the performance of the company in terms of the owners' investment. (After-tax Net Income/Owners' equity).
Reverse stock split
The corporation's recall of its old shares of stock and issuance of a smaller number of new shares in their place.
Sttock dividend
The distribution of additional shares of the corporation's stock to existing shareholders.
Stock split
The corporation's recall of its old shares of stock and issuance of a larger number of new shares in their place.
Times interest earned ratio
A measure of the company's ability to serrvice its debt. (Earnings before interest & taxes/Interest expense).
Treasury stock
The shares of a corporation's issued stock that the corporation has repurchased and intends to reissue at a later date.