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27 Cards in this Set
- Front
- Back
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Authorized stock |
The amount of stock that a corporation is authorized to sell as indicated in its charter. |
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Cash dividend |
A pro rata (proportional to ownership) distribution of cash to stockholders. |
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Charter |
A document that describes a corporation's name and purpose, types of stock and number of shares authorized, names of individuals involved in the formation, and number of shares each individual has agreed to purchase. |
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Corporation |
A company organized as a separate legal entity, with most of the rights and privileges of a person. |
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Cumulative dividend |
A feature of preferred stock entitling the stockholder to receive current and unpaid prior-year dividends before common stockholders receive any dividends. |
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Declaration date |
The date the board of directors formally authorizes the dividend and announces it to stockholders. |
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Deficit |
A debit balance in Retained Earnings. |
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Dividend |
A distribution by a corporation to its stockholders on a pro rata (proportional to ownership) basis. |
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Dividends in arrears |
Preferred dividends that were supposed to be declared but were not declared during a given period. |
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Legal capital |
The amount of capital that must be retained in the business for the protection of corporate creditors. |
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No-par value stock |
Capital stock that has not been assigned a value in the corporate charter. |
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Outstanding stock |
Capital stock that has been issued and is being held by stockholders. |
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Paid-in capital |
The amount stockholders paid in to the corporation in exchange for shares of ownership. |
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Par value stock |
Capital stock that has been assigned a value per share in the corporate charter. |
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Payment date |
The date cash dividend payments are made to stockholders. |
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Payout ratio |
A measure of the percentage of earnings a company distributes in the form of cash dividends to common stockholders. |
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Preferred stock |
Capital stock that has contractual preferences over common stock in certain areas. |
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Privately held corporation |
A corporation that has only a few stockholders and whose stock is not available for sale to the general public. |
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Publicly held corporation |
A corporation that may have thousands of stockholders and whose stock is traded on a national securities market. |
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Record date |
The date when the company determines ownership of outstanding shares for dividend purposes. |
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Retained earnings |
Net income that a company retains in the business. |
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Retained earnings restrictions |
Circumstances that make a portion of retained earnings currently unavailable for dividends. |
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Return on common stockholders' equity (ROE) |
A measure of profitability from the stockholders' point of view; computed by dividing net income minus preferred dividends by average common stockholders' equity. |
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Stated value |
The amount per share assigned by the board of directors to no-par stock. |
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Stock dividend |
A pro rata (proportional to ownership) distribution of the corporation's own stock to stockholders. |
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Stock split |
The issuance of additional shares of stock to stockholders accompanied by a reduction in the par or stated value per share. |
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Treasury stock |
A corporation's own stock that has been reacquired by the corporation and is being held for future use. |
