Date of Award

6-1925

Degree Type

Bachelors Essay

Degree Name

Bachelor of Science (BS)

Department

Business Administration

First Advisor

Edward M. Wagner

Second Advisor

Fred D. Merrill

Abstract

"Capital stock, whether of the type that represents all the assets of the corporation or the type that represents merely the residual equity after all other claims have been satisfied, involves two distinct ideas--a participation in the rights of ownership and a valuation in this anticipation. This latter is the par value. It is the less important. The stockholder can never collect, like the bondholder, the par value of his security from the corporation. Even though paid for in full and representing for a short time the full and actual value, the equality passes with the first business transaction, for the value of the property behind the shares changes with every step in the success or failure of the corporation, as new property is added, or old property lost or dissipated. The essential characteristics of capital stock are: that it remains permanent whatsoever the fortunes of the actual capital is; that it stands for a definite proportion of the corporate property and earnings. This involves no par value. The purpose of stock would therefore be fully accomplished if the shares were merely proportionate parts of a total, in other words, shares without par value."

Comments

A Thesis Submitted To Fulfill the Requirements For The Degree of Bachelor of Science in Commerce, Milwaukee, Wisconsin.

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