The par value of a share is
A)Another name for the call price of a share
B)A type of callable share
C)The market value of the shares on the date of issuance
D)An unpaid dividend
E)An arbitrary value a corporation places on each of the corporation's shares

Question

Quizplus · Accepted Answer

Par value is an arbitrary value placed on each share by the corporation, usually set at a low amount such as $0.01 per share. It is not related to market value, call price, or dividend payment. It is mainly used for accounting and legal purposes, such as calculating the minimum legal capital requirements for the corporation.

The Par Value of a Share Is