Additional Paid-In Capital

Explore commonly used personal finance terms.

Additional paid-in capital refers to the amount shareholders pay for shares above the par or nominal value of stock, which is recorded as equity on a company’s balance sheet. This capital provides a financial buffer and can be used for reinvestment in growth, paying dividends, or other strategic initiatives. Additional paid-in capital reflects investor confidence and strengthens the company’s financial standing, as it represents funds contributed beyond the basic stock price.

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