Shareholder equity

From open-encyclopedia.com - the free encyclopedia.

In business and accounting, shareholder equity refers to the value of what is owned by a Company's shareholders. Specifically, it is the value of a Company's assets less the value of its liabilities.

Shareholders' equity appears on the credit side of a company's balance sheet. Accounts listed under shareholders' equity include:

• Common stock
• Preferred stock
• Paid in capital
• Retained earnings

Equity financing is the method by which a company raises money by selling shares of stock.