Question

The par value of common stock represents: the amount received when the stock was issued. the liquidation value of a share. the market value of a share of stock. the legal capital per share of stock assigned when the corporation was first established.

Answer 1

The par value of common stock represents the arbitrary dollar amount assigned to a share of stock. This value is the stated value per share as outlined in the issuing company's charter. This calue is also called the face value because it's the value printed on the face of a bond or stock certificate.