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What does 'under subscription' mean?
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It refers to the situation where fewer shares are purchased than expected.
What are the two main types of shares a company can issue?
Equity shares and preference shares.
What does the term 'calls' mean in the context of share capital?
It refers to the money demanded in further installments after allotment.
Who is referred to as a 'shareholder'?
A person who buys a share in the company.
What distinguishes equity shares from preference shares?
Equity shares do not have any priority rights, whereas preference shares receive dividends and capital return before equity shares.
Describe 'allotment money' in share issuance.
The money demanded after the application stage.
Define 'paid up capital'.
The total amount of money shareholders have paid for the shares.
Define 'full subscription' in the context of share issuance.
When all the shares issued by the company are purchased.
Differentiate between Issued Share Capital and Subscribed Share Capital.
Issued Share Capital is the amount of capital issued to the public, while Subscribed Share Capital is the amount of share purchased by the public.
What does 'lump sum' mean regarding methods of raising capital?
It means demanding all the money at once from the investors.
What is the primary reason a company issues shares to the public?
To raise capital when the company needs funds.
What is 'called up capital'?
The total amount of money a company has asked the shareholders to pay for the shares.
What is Authorized Share Capital?
The capital noted in the company's Memorandum of Association (MOA) that a company can raise during its lifetime.
What is 'application money' in the share issuing process?
It is the amount of money a company demands first from the applicants.
Explain 'over subscription' in share offerings.
It is when the demand for shares exceeds the number offered by the company.
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