The Par Value of the Common Stock Represents the

question 86

Multiple Choice

The par value of the common stock represents the

• A)amount entered into the corporation's Common Stock account when a share is issued.
• B)liquidation value of the stock.
• C)market value of a share of stock.
• D)amount the corporation received when the stock was issued.

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Definitions:

Outstanding Shares

The total number of shares of stock that are owned by stockholders on any particular date.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing ownership interest.

Treasury Stock

Shares that were originally issued and fully paid for but have since been bought back by the issuing company, reducing the amount of outstanding stock.

Purchases

The acquisition of goods or services in exchange for monetary payment in the course of business operations.