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Unformatted text preview: reorganization. 4. Distribution of a liquidating dividend. 4. Additional assessments on shareholders. 5. Retirement of shares at a cost in excess of par* or assigned value. 5. Issue of convertible bonds or preferred shares. 6. Capital donations from non-shareholders. 7. Retirement of shares acquired by purchase at a cost less than par* or assigned value or through donations. * Items relate to shares having a par value (See Appendix 16A for further explanation). 2. Analyze shareholders equity: Several ratios use shareholders equity to evaluate a companys profitability and long-term solvency. The chapter discusses four ratios: a) rate of return on common shareholders equity, b) payout ratio, c) price earnings ration, and d) book value per share. F. Accounting for Par Value Shares (Appendix 15A)Where Permitted by Law Par value establishes the nominal value per share and is the minimum amount that must be paid by each shareholder....
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- Spring '10