WHAT IS SHARE CAPITAL?
Share capital means the capital raised by a company by the issue of shares. the word "capital" in connection with a company is used in several senses:
1.authorised capital.
2.issued capital.
3.paid up capital.
4.reserve capital.
1.authorised capital:
This is a nominal value of the shares which a company is authorised to issue by its memorandum of association.
2.issued capital:
This type of capital nominal value of the shares which is the offered to the public for subcription. a company does not normally issue all its capital at once, so that issued capital in such a case is less then the issued capital.
3.Called up capital:
That part of the capital of issued which has been called up on the shares.
4.paid up capital:
This is a part of the issued capital which has been paid up by the share holders or which is credited as paid up on the shares.
6.Reserve capital:
This is that part of the uncalled capital of a company which can be called only in the event of its winding up, a limited company may, by a special resolution, determine that the portion of its uncalled capital shell not be called. inn the event of and the purpose of the company winding up and such capital is known as reserve capital.
Saturday, August 15, 2009
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