What is common stock?
Common stock is the most basic form of ownership in a company. For example, when you buy a share of Apple stock in your E-Trade or Robinhood account, you are buying common stock.
Common stock provides ownership in the common, as well as voting rights. However, the main drawback of common stock is that in the case of bankruptcy or liquidation, common shareholders are the last to get paid. Common shareholders would be paid after preferred shareholders, bond holders, and any lendors.
Lastly, common shareholders are not guaranteed a dividend. Common shareholders only receive a dividend if the Board of Directors authorizes and declares a dividend. The dividend per share will likely fluctuate based on the company’s current year financial performance.
You might also be interested in...
July 2021 Changes to The CPA Exam: Everything You Need to Know
Change is right around the corner! The talk of the (CPA) town is that changes are upon us and they are coming quickly. While this is not an overhaul in the way that CPA evolution will be in 2024, there are changes that are being made to all four sections (FAR, REG, AUD, and BEC) […]
2021 AICPA Released Questions
Buckle up and get ready to crush the CPA exam! The AICPA has released additional multiple choice questions for BEC, AUD, REG, and FAR. We’re beginning to incorporate the questions into the Universal CPA Review platform and we will be uploading videos for certain questions to each of the respective pages below. Creating a high […]
AICPA 2021 Released Questions for BEC
The moment we’ve all been waiting for! Additional question have been released by the AICPA for BEC! The topics are very random, so its a good way to test your understanding if you have been studying. If you haven’t been studying for BEC, it is a great way to see what you will be touching […]