Identify and briefly describe the two primary sources of shareholders’ equity.

Question

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Answer 1

Textbook Question

Chapter 18, Problem 18.1Q

Identify and briefly describe the two primary sources of shareholders’ equity.

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

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Answer 2

Textbook Question

Chapter 18, Problem 18.1Q

Identify and briefly describe the two primary sources of shareholders’ equity.

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

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Answer 3

Textbook Question

Chapter 18, Problem 18.1Q

Identify and briefly describe the two primary sources of shareholders’ equity.

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

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Answer 4

Textbook Question

Chapter 18, Problem 18.1Q

Identify and briefly describe the two primary sources of shareholders’ equity.

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

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Answer 5

Textbook Question

Answer 6

Textbook Question

Answer 7

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

Answer 8

Expert Solution & Answer

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.

Explanation of Solution

The two primary sources of shareholders’ equity is:

1. Paid in capital
2. Retained earnings

Paid in capital:

Paid in capital represents the amount invested by the shareholders of the business in common stock and/or preferred stock.

Retained earnings:

Retained earnings are the portion of earnings kept by the business for the purpose of reinvestments, payment of debts, or for future growth.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

To determine

Shareholders’ equity: Shareholders’equity refers to the right the owner possesses over the resources of the business. In other words, Shareholders’equity refers to the amount of capital that includes the amount of investment by the stockholders, earnings generated from the normal business operations, and less any dividends paid to the stockholders.

To identify and briefly: Define the two primary sources of shareholders’ equity.