Equity (finance)

equityshareholders' equityequity capitalequity stakestakeownership equityequitiesequity financingowner's equityshareholder's equity
In finance, equity is ownership of assets that may have debts or other liabilities attached to them.wikipedia
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Liability (financial accounting)

liabilitiesliabilitydebt
In finance, equity is ownership of assets that may have debts or other liabilities attached to them.
The accounting equation relates assets, liabilities, and owner's equity:

Financial statement

financial statementsfinancial reportingfinancial report
Businesses summarize their equity in a financial statement known as the balance sheet (or statement of net position) which shows the total assets, the specific equity balances, and the total liabilities and equity (or deficit).
Consolidated financial statements are defined as "Financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent (company) and its subsidiaries are presented as those of a single economic entity", according to International Accounting Standard 27 "Consolidated and separate financial statements", and International Financial Reporting Standard 10 "Consolidated financial statements".

Accounting equation

assets minus liabilities equals owners' equityliabilities
The fundamental accounting equation requires that the total of liabilities and equity is equal to the total of all assets at the close of each accounting period.
The fundamental accounting equation, also called the balance sheet equation, represents the relationship between the assets, liabilities, and owner's equity of a person or business.

Debt

debtsprincipalborrowing
In finance, equity is ownership of assets that may have debts or other liabilities attached to them.
In addition, business owners do not sell equity or relinquish control when using revenue-based financing.

Balance sheet

statement of financial positionbalance sheetsbalance-sheet
Businesses summarize their equity in a financial statement known as the balance sheet (or statement of net position) which shows the total assets, the specific equity balances, and the total liabilities and equity (or deficit).
Assets, liabilities and ownership equity are listed as of a specific date, such as the end of its financial year.

Asset

assetstotal assetstangible asset
In finance, equity is ownership of assets that may have debts or other liabilities attached to them.
It relates assets, liabilities, and owner's equity:

Share capital

capital stockcapitalshares
Preferred stock, share capital (or capital stock) and capital surplus (or additional paid-in capital) reflect original contributions to the business from its investors or organizers.
A corporation's share capital or capital stock (in US English) is the portion of a corporation's equity that has been obtained by the issue of shares in the corporation to a shareholder, usually for cash.

Share repurchase

stock buybackshare buybackbuy back
Treasury stock appears as a contra-equity balance (an offset to equity) that reflects the value of stock that a business has repurchased from shareholders.
In most countries, a corporation can repurchase its own stock by distributing cash to existing shareholders in exchange for a fraction of the company's outstanding equity; that is, cash is exchanged for a reduction in the number of shares outstanding.

Financial accounting

Financial accountancyfinancial accountsaccounting
Financial accounting defines the equity of a business as the net balance of its assets reduced by its liabilities.
The balance sheet is the financial statement showing a firm's assets, liabilities and equity (capital) at a set point in time, usually the end of the fiscal year reported on the accompanying income statement.

Capital surplus

share premiumAdditional paid in capitaladditional paid-in capital
Preferred stock, share capital (or capital stock) and capital surplus (or additional paid-in capital) reflect original contributions to the business from its investors or organizers.
Capital surplus, also called share premium, is an account which may appear on a corporation's balance sheet, as a component of shareholders' equity, which represents the amount the corporation raises on the issue of shares in excess of their par value (nominal value) of the shares (common stock).

Retained earnings

ploughed backaccumulated deficitearnings
Retained earnings (or accumulated deficit) is the running total of the business's net income and losses, excluding any dividends.
Retained earnings are reported in the shareholders' equity section of the corporation's balance sheet.

Debits and credits

debitcreditdebit and credit
Treasury stock appears as a contra-equity balance (an offset to equity) that reflects the value of stock that a business has repurchased from shareholders.
All accounts must first be classified as one of the five types of accounts (accounting elements) ( asset, liability, equity, income and expense).

Reserve (accounting)

reservereservescash reserves
In the United Kingdom and other countries that use its accounting methods, equity includes various reserve accounts that are used for particular reconciliations of the balance sheet.
In financial accounting, "reserve" always has a credit balance and can refer to a part of shareholders' equity, a liability for estimated claims, or contra-asset for uncollectible accounts.

Treasury stock

treasury sharesTreasury Shareshare buyback
Treasury stock appears as a contra-equity balance (an offset to equity) that reflects the value of stock that a business has repurchased from shareholders.
On the balance sheet, treasury stock is listed under shareholders' equity as a negative number.

Statement of changes in equity

statement of changes in net assets/equityStatement of Changes in Taxpayers’ Equity
Another financial statement, the statement of changes in equity, details the changes in these equity accounts from one accounting period to the next.
The statement is expected under the generally accepted accounting principles and explains the owners' equity shown on the balance sheet, where:

Dividend

dividendsstock dividendcash dividend
Retained earnings (or accumulated deficit) is the running total of the business's net income and losses, excluding any dividends. Equity investing is the business of purchasing stock in companies, either directly or from another investor, on the expectation that the stock will earn dividends or can be resold with a capital gain.
A retail co-op store chain may return a percentage of a member's purchases from the co-op, in the form of cash, store credit, or equity.

Private equity

private-equityequityPrivate equity investor
Private equity is, strictly speaking, a type of equity and one of the asset classes consisting of equity securities and debt in operating companies that are not publicly traded on a stock exchange.

Enterprise value

enterprise valuesEVTotal Enterprise Value
According to the "Merton model," the value of stock equity is modeled as a call option on the value of the whole company (including the liabilities), struck at the nominal value of the liabilities.
Enterprise value is more comprehensive than market capitalization, which only reflects common equity.

Secured loan

securedsecured debtCollateral loan
Any asset that is purchased through a secured loan is said to have equity.

Home equity loan

Home Equity Loanshome equity conversion loanHome-equity debt
Common examples include home equity loans and home equity lines of credit.

Home equity line of credit

HELOChome equity lines of creditHELOCs
Common examples include home equity loans and home equity lines of credit.

Bankruptcy

bankruptbankruptcy protectionbankruptcies
If the business becomes bankrupt, it can be required to raise money by selling assets.

Preferred stock

preference sharespreferred sharespreference share
Preferred stock, share capital (or capital stock) and capital surplus (or additional paid-in capital) reflect original contributions to the business from its investors or organizers.

United Kingdom

BritishUKBritain
In the United Kingdom and other countries that use its accounting methods, equity includes various reserve accounts that are used for particular reconciliations of the balance sheet.

Capital gain

capital gainscapital growthcapital income
Equity investing is the business of purchasing stock in companies, either directly or from another investor, on the expectation that the stock will earn dividends or can be resold with a capital gain.