Corporations: Paid-in Capital, Retained Earnings, Dividends, and Treasury Stock

Read this chapter, which outlines the different sources of paid-in capital and how they are presented on the balance sheet. This chapter also covers treasury stock, dividends, stock splits, and price-per-share and price-per-earnings ratios.

Paid-in capital – Stock dividends

When it declares a stock dividend, a corporation distributes additional shares of stock (instead of cash) to its present stockholders. A later section discusses and illustrates how the issuance of a stock dividend results in a credit to a Paid-In Capital – Stock Dividends account.