Account for share repurchases, dividends, and stock splits.

- Assets are distributed to shareholders by:

- repurchasing their shares, or

- paying dividends.

- Generally the cost of share repurchases is recorded as a reduction in shareholders' equity.

- Typically the corporation pays dividends with cash.

- Stock dividends and stock splits do not represent a payout to shareholders. These transactions have no effect on total shareholders' equity.

- Preferred shares generally have dividend preferences such as being cumulative or participating.