Bars

How to Calculate and Account for Stock Issuances

By Motley Fool Staff – Updated Apr 30, 2025 at 3:20 PM EST

Key Points

Issuing stock boosts a company's cash but requires precise accounting for the shares.
To determine stock issuance proceeds, multiply shares by price and subtract underwriter fees.
Stock issuance impacts cash, common stock, and paid-in capital accounts on the balance sheet.

When companies need to raise money, they often do so by selling additional shares of stock. These stock issuances have consequences not just to the amount of cash the company has on hand but also on the company's accounting statements. Below, we'll look at how you calculate the results of a stock issuance and what you need to do to account for it correctly.

Loading paragraph...

An up-close view of a paper stock certificate. — Image Source: Getty Images.

Loading image...

Loading paragraph...

Essential Financial Formulas You Should Know

If you're going to become an investor, there are a few things you should know — like these formulas. Keep reading to learn more.

Here's How to Calculate Future Expected Stock Price

Calculating the future expected stock price can be useful, but no single equation can be used universally.

How to Calculate Total Assets, Liabilities, and Stockholders' Equity

Assets, liabilities, and stockholders' equity are three features of a balance sheet. Here's how to determine each one.

How to Track Stocks With Google Finance & Google Sheets

Google makes it easy to track stocks with Google Finance, a free set of tools to stay up to date on your portfolio.

Loading hub_pages...

Stock issuances are important ways for companies to get the capital they need. By knowing how to calculate and account for them properly, you'll learn to recognize them when you see them in a company's financial statements.

Loading paragraph...