Define each of the following terms:b. Common stockholders’ equity, or net worth; retained earnings

Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter11: Accounting For Transactions Using A General Journal
Section11.3: Accounting For The Declaration And Payment Of A Dividend
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Define each of the following terms:
b. Common stockholders’ equity, or net worth; retained earnings

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Common stockholders' equity or net worth:

Common stockholders' equity or net worth is the capital includes corporation's capital stock, retained earnings and capital reserves. Common stockholder’s equity is considering as the equity of public stockholders.

In simple words, common stockholder’s equity or net worth is the sum of the share capital of the firm and retained earnings.

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