|Common stock equivalent|
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Definition of Common stock equivalent
Common stock equivalent
A convertible security that is traded like an equity issue because the optioned
Acquisition of stock
A merger or consolidation in which an acquirer purchases the acquiree's stock.
Adjustable rate preferred stock (ARPS)
Publicly traded issues that may be collateralized by mortgages and MBSs.
American Stock Exchange (AMEX)
The second-largest stock exchange in the United States. It trades
Auction rate preferred stock (ARPS)
Floating rate preferred stock, the dividend on which is adjusted every
Beta equation (Stocks)
The beta of a stock is determined as follows:
The method used for computing the bond-equivalent yield.
Bond equivalent yield
Bond yield calculated on an annual percentage rate method. Differs from annual
The annualized yield to maturity computed by doubling the semiannual yield.
Bond Equivalent Yield
Bond yield calculated on an annual percentage rate method
BOOK VALUE OF COMMON STOCK
The theoretical amount per share that each stockholder would receive if a company’s assets were sold on the balance sheet’s date. Book value equals:
Ownership shares issued by a business corporation. A business
The total amount of plant, equipment, and other physical capital.
CASH AND CASH EQUIVALENTS
The balance in a company’s checking account(s) plus short-term or temporary investments (sometimes called “marketable securities”), which are highly liquid.
Cash and equivalents
The value of assets that can be converted into cash immediately, as reported by a
A short-term security that is sufficiently liquid that it may be considered the financial
Temporary investments of currently excess cash in short-term, high-quality
Highly liquid, fixed-income investments with original maturities of three months or less.
Instruments or investments of such high liquidity and safety that they are virtually equal to cash.
Cash flow per common share
Cash flow from operations minus preferred stock dividends, divided by the
An amount that would be accepted in lieu of a chance at a possible higher, but
The representing of accounting information over multiple years as percentages
common body of knowledge (CBK)
the minimum set of knowledge needed by a person to function effectively in a particular field
An agreement between two or more countries that permits the free movement of capital
Are equity instruments that take no security against assets, have no fixed terms of repayment and pay no fixed dividends.
common-size balance sheet
Balance sheet that presents items as a percentage of total assets.
common-size income statement
Income statement that presents items as a percentage of revenues.
These are securities that represent equity ownership in a company. common shares let an
Shares of ownership sold to the public.
A financial security that represents an ownership claim on the
Ownership shares in a publicly held corporation.
That part of the capital stock of a corporation that carries voting rights and represents
Common stock market
The market for trading equities, not including preferred stock.
Common stock/other equity
Value of outstanding common shares at par, plus accumulated retained
Common stock ratios
Ratios that are designed to measure the relative claims of stockholders to earnings
Conflict between bondholders and stockholders
These two groups may have interests in a corporation that
Inventories owned by a company, but located on the premises
Convertible exchangeable preferred stock
Convertible preferred stock that may be exchanged, at the
Convertible preferred stock
Preferred stock that can be converted into common stock at the option of the holder.
Corporate taxable equivalent
Rate of return required on a par bond to produce the same after-tax yield to
Cost of Common Stock
The rate of return required by the investors in the common stock of
Cost of Preferred Stock
The rate of return required by the investors in the preferred stock of
Coupon equivalent yield
True interest cost expressed on the basis of a 365-day year.
Cumulative preferred stock
Preferred stock whose dividends accrue, should the issuer not make timely
The informal and frequently unauthorized retention of excess inventory on the shop floor, which is used as buffer safety stock.
Direct stock-purchase programs
The purchase by investors of securities directly from the issuer.
Dividend yield (Stocks)
Indicated yield represents annual dividends divided by current stock price.
Earnings per share of common stock
How much profit a company made on each share of common stock this year.
Employee stock fund
A firm-sponsored program that enables employees to purchase shares of the firm's
Employee stock ownership plan (ESOP)
A company contributes to a trust fund that buys stock on behalf of
Employee Stock Ownership Plan (ESOP)
a profit-sharing compensation program in which investments are made in
Employee Stock Ownership Plan (ESOP)
A fund containing company stock and owned by employees, paid for by ongoing contributions by the employer.
Equivalent annual annuity
The equivalent amount per year for some number of years that has a present
Equivalent annual benefit
The equivalent annual annuity for the net present value of an investment project.
Equivalent annual cash flow
Annuity with the same net present value as the company's proposed investment.
Equivalent annual cost
The equivalent cost per year of owning an asset over its entire life.
equivalent annual cost
The cost per period with the same present value as the cost of buying and operating a machine.
Equivalent bond yield
Annual yield on a short-term, non-interest bearing security calculated so as to be
Given the after-tax stream associated with a lease, the maximum amount of conventional
Equivalent taxable yield
The yield that must be offered on a taxable bond issue to give the same after-tax
equivalent units of production (EUP)
an approximation of the number of whole units of output that could have been
Exchange of stock
Acquisition of another company by purchase of its stock in exchange for cash or shares.
Also called a busted convertible, a convertible security that is trading like a straight
Low-cost, high-usage inventory items stored near the shop floor,
common stock of a company that has an opportunity to invest money and earn more than the
Heavenly Parachute Stock Option
A nonqualified stock option that allows a deceased option holder’s estate up to three years in which to exercise his or her
Incentive Stock Option
An option to purchase company stock that is not taxable
common stock with a high dividend yield and few profitable investment opportunities.
Privately placed common stock, so-called because the SEC requires a letter from the purchaser
stocks that are traded on an exchange.
stocks that are traded on an exchange.
A production scheduling system under which products are completed
Margin account (Stocks)
A leverageable account in which stocks can be purchased for a combination of
New York Stock Exchange (NYSE)
Also known as the Big Board or The Exhange. More than 2,00 common
No par value stock
stock issued by the company that does not have an arbitrary value (par value) assigned to it.
Non-cumulative preferred stock
Preferred stock whose holders must forgo dividend payments when the
Nonqualified Stock Option
A stock option not given any favorable tax treatment
Outbound stock point
A designated inventory location on the shop floor between
Philadelphia Stock Exchange (PHLX)
A securities exchange where American and European foreign
A security that ranks junior to preferred stock but senior to common stock in the right to
Preferred equity redemption stock (PERC)
Preferred stock that converts automatically into equity at a
A security that shows ownership in a corporation and gives the holder a claim, prior to the
A type of equity security where holders have a claim on the assets
A type of stock that usually pays a fixed dividend prior to any distributions
stock that takes priority over common stock in regard to dividends.
Preferred stock agreement
A contract for preferred stock.
Preferred Stock Stock that has a claim on assets and dividends of a corporation that are prior
to that of common stock. Preferred stock typically does not carry the right to vote.
RATE OF RETURN ON STOCKHOLDERS’ EQUITY
The percentage return or profit that management made on each dollar stockholders invested in a company. Here’s how you figure it:
RATIO OF DEBT TO STOCKHOLDERS’ EQUITY
A ratio that shows which group—creditors or stockholders—has the biggest stake in or the most control of a company:
Redeemable Preferred Stock
A preferred stock issue that must be redeemed by the issuing enterprise or is redeemable at the option of the investor. Considered a debt security for accountingpurposes.
Repurchase of stock
Device to pay cash to firm's shareholders that provides more preferable tax treatment
Return on Common Equity Ratio
A measure of the percentage return earned on the value of the
Reverse stock split
A proportionate decrease in the number of shares, but not the value of shares of stock
a buffer level of inventory kept on hand by a company in the event of fluctuating usage or unusual delays in lead time
Extra inventory kept on hand to guard against requirements
Stated value stock
stock issued by the company that does not have a par value, but does have a stated value. For accounting purposes, stated value is functionally equivalent to par value.
Ownership of a corporation which is represented by shares which represent a piece of the corporation's
Certificates that signify ownership in a corporation. A share of stock represents a claim on a portion of the company’s assets.
Units of ownership, also called shares, in a public corporation. Owners of such units, called shareholders, share in the earnings of the company through dividends. The price of a stock is determined by supply and demand in the stock market.
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