Additional Paid-In Capital (APIC)

What is Additional Paid-In Capital (APIC)?

Additional paid-in capital is the amount investors pay for a company’s shares above their par value during the issuance of stock. It reflects the extra money shareholders contribute beyond the nominal value of common stock and is recorded under shareholders’ equity on the balance sheet.

Formula:
APIC = (Issue price – Par value) × Number of shares issued

Example: If a company issues 1,000 shares at $10 each with a $1 par value, APIC = ($10 – $1) × 1,000 = $9,000