Series 7: 9.4.1.2.3. Shareholders’ Equity

9.4.1.2.3. Shareholders’ Equity

The third section of the balance sheet is shareholders’ equity, which is the capital invested by shareholders. Shareholders’ equity is also called the book value of the company because it is the amount available to shareholders if the company is forced to liquidate. Shareholders’ equity is equal to assets minus liabilities. There are three categories of shareholders’ equity. First, there is paid-in capital. This is the amount of money “paid in” or invested by the preferred an