Equity in a corporation is most commonly represented by what?

Equity in a corporation primarily refers to the ownership interest that shareholders have in the company, which is most commonly represented by shares. When individuals or institutional investors buy shares, they are purchasing a piece of ownership in the corporation. This ownership entitles them to a portion of the company’s profits, typically distributed in the form of dividends, as well as potential appreciation in share value over time.

Other options presented relate to different aspects of a corporation’s financial structure. Bonds represent debt and are obligations that a corporation owes to bondholders, not ownership stakes. Liabilities are financial obligations that a company must pay to others, such as loans and accounts payable, which do not provide ownership rights. Assets represent what the company owns and can use to generate revenue, but they do not indicate ownership by investors. Thus, shares serve as the most direct representation of equity that reflects the ownership held by shareholders in a corporation.