Dividends are a common way for companies to pay back some of their capital to shareholders. Dividends paid in stock shares are debited from a subaccount called the additional paid-in capital.

The value of capital stock is typically a combination of its paid-in capital based on par value and its additional paid-in capital. A company typically sets its common stock’s par value at a ...

When shares are bought and sold among investors on the secondary market, no additional paid-up capital is created as proceeds in those transactions go to the selling shareholders, not the issuing ...