11

Stockholders’ Equity: Capital Stock

and Dividends

Learning Goals

Describe the nature of the corporate form of organization.

List the major sources of paid-in capital, including the

various classes of stock.

Describe the financial statement effects of issuing stock.

Describe the financial statement effects of treasury stock

transactions.

Describe the effect of stock splits on the financial

statements.

Analyze the impact of issuing common stock or bonds.

Describe the financial statement effects of cash dividends

and stock dividends.

Describe financial statement presentations of

stockholders’ equity.

Compute and interpret the dividend yield and dividend

payout ratio on common stock.

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