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Share capital

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  • 1. SHARE CAPITALPresented by : SheetalNarkar
  • 2. SHARE CAPITAL
    Share Capital : Capital raised by the company by the issue of shares.
    Share Capital consists of various parts :
    Authorized or Nominal Capital
    Issued or Subscribed Capital
    Called – up Capital
    Paid – up Capital
    Uncalled Capital
    Reserve Capital
  • 3.
    • Authorized Capital :
    • 4. It is the nominal value of the shares which a company is authorized to issue by its Memorandum of Association
    • 5. It is the maximum capital which a company will have during its lifetime unless it is increased.
    Authorized CAPITAL
  • 6. ISSUED CAPITAL
    • Issued Capital :
    • 7. It is the nominal value of shares which are offered to the public for subscription.
    • 8. Issued Capital < Authorized Capital
    • 9. Issued Capital can never exceed Authorized Capital
    • Called up Capital :
    • 10. It is the part of issued capital which has been called up on the shares
    • 11. Uncalled Capital :
    • 12. It is the remainder of the issued capital which has not been called up.
    • 13. The company may call this amount any time
    CALLED UP & UNCALLED CAPITAL
  • 14. Paid - up & reserve capital
    • Paid up Capital :
    • 15. It is the part of issued capital which has been paid up by the shareholders
    • 16. Reserve Capital :
    • 17. It is that part of uncalled capital of a company which can be called only in the event of its winding up
  • SHARE CAPITAL
    Capital Requirement (long run) = Rs. 1,000,000
    Current Requirement = Rs. 50,000. 
    Authorized Capital = Rs. 1,000,000
    Issued Capital = Rs. 50,000
    (Issued shares)
  • 18. If you need 30,000 as current requirement :
    Called – up Capital = Rs. 30,000
    Uncalled Capital = Rs. 20,000
    But you receive only Rs. 24,000
    Paid up Capital = Rs. 24,000
    SHARE CAPITAL
  • 19. ALTERATION OF CAPITAL (sec 94)
    • Increase the nominal share capital by issuing new shares
    • 20. Divide all or any part of its share capital into shares of larger amount
    • 21. Convert fully paid up shares into stock
    • 22. Subdivide its shares or any part of them into shares of smaller amount
    • 23. Cancel shares which have not been taken up