Common stock and additional-paid in capital represent the financing sources from shareholders.

Common Stock

Shares representing ownership in a corporation, giving holders rights to dividends and influence through voting.

Additional-Paid In Capital

The amount of money paid by investors above the par value of the shares, also known as share premium.

Financing Sources

Various methods a company uses to raise capital or funds, including debt financing, equity financing, and internal generated funds.

Attaining an understanding of the balance sheet's structure and components, with a focus on assets, liabilities, and equity of shareholders.
Insight into the role and administration of different items in financial accounts, such as current and non-current assets, liabilities, and components of shareholders' equity, encompassing common stock and additional paid-in capital.

Verified Answer

May 04, 2024

Final Answer :

True

Explanation :

Common stock and additional-paid in capital are both forms of shareholder equity, which represents the financing provided by shareholders.

Learning Objectives

Attaining an understanding of the balance sheet's structure and components, with a focus on assets, liabilities, and equity of shareholders.
Insight into the role and administration of different items in financial accounts, such as current and non-current assets, liabilities, and components of shareholders' equity, encompassing common stock and additional paid-in capital.