Contributed Capital

AAA

DEFINITION of 'Contributed Capital'

An entry on the shareholders' equity section of a company's balance sheet that summarizes the total value of stock that shareholders have directly purchased from the issuing company.

Contributed capital is calculated by adding the par value of the shares to the value paid that was greater than par value.

INVESTOPEDIA EXPLAINS 'Contributed Capital'

Shares that investors purchased from the secondary markets are not incorporated into the contributed capital. However, shares sold as a result of a secondary offering would count, as the proceeds of these shares go directly to the issuing company.

RELATED TERMS
  1. Par Value

    The face value of a bond. Par value for a share refers to the ...
  2. Equity Financing

    The act of raising money for company activities by selling common ...
  3. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  4. Secondary Market

    A market where investors purchase securities or assets from other ...
  5. Secondary Offering

    1. The issuance of new stock for public sale from a company that ...
  6. Stockholders' Equity

    The portion of the balance sheet that represents the capital ...
RELATED FAQS
  1. What does total stockholders equity represent?

    Total stockholders' equity represents either the source of a company's assets, the owners' residual claim of a company's ... Read Full Answer >>
  2. Why would a stock have no par value?

    People often get confused when they read about the "par value" for a stock. One reason for this is that the term has slightly ... Read Full Answer >>
Related Articles
  1. Investing Basics

    Reading The Balance Sheet

    Learn about the components of the statement of financial position and how they relate to each other.
  2. Bonds & Fixed Income

    Evaluating A Company's Capital Structure

    Learn to use the composition of debt and equity to evaluate balance sheet strength.
  3. Investing Basics

    Explaining Pro-Rata

    Pro-rata is a term meaning a fraction of a whole based on a relationship to the whole. Proportionate allocations are made pro-rata.
  4. Investing

    What are Preference Shares?

    Preference shares, also referred to as preferred shares, are equity shares that give the shareholders certain rights ahead of common shareholders. For instance, when the corporation declares ...
  5. Stock Analysis

    Intel Doesn't Need New Management

    Intel's purported manufacturing technology prowess has been completely squandered in the mobile arena, and the stock has been a disappointment.
  6. Stock Analysis

    Will Spinoffs Give American Capital A Pop?

    American Capital shareholders have long awaited a plan to spin off the company's investments from its prized asset-management business.
  7. Stock Analysis

    Will American Airlines Fall Back To Earth In 2015?

    The airline industry enjoys blockbuster profits, and American Airlines Group has been a key beneficiary of the favorable trends that have lifted stocks.
  8. Stock Analysis

    Freeport-McMoRan Is Seeking A Helping Hand

    Freeport-McMoRan doesn't have the cash to invest in its planned oil and gas developments, which is forcing it to look for help in funding these projects.
  9. Stock Analysis

    Qualcomm's New Buyback Program Is Well-Timed

    Qualcomm announced after market close on Monday that they had approved a new stock buyback program, authorizing to repurchase $15 billion in shares.
  10. Stock Analysis

    Should You Leave Galena To The Day Traders?

    There are few sectors as exciting as the biotech sector, and shareholders of Galena Biopharma have certainly been privy to a ride over the past two years.

You May Also Like

Hot Definitions
  1. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  2. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  3. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  4. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  5. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  6. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
Trading Center