Shares Flashcards

1
Q

Market value =

A

Share price

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2
Q

Par (nominal value) =

A

Value of share when the company was incorporated

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3
Q

Authorised capital =

A

Maximum of share capital a company can issue

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4
Q

Issued capital =

A

Par amount of share capital issued to shareholders

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5
Q

Called up capital =

A

When shared are issued/ allotted, a company doesn’t expect the full amount to be paid, they wait for a later date before the remainder is called up

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6
Q

Paid up capital =

A

When capital is called up, some shareholders might delay or default on their payment

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7
Q

Retained earnings =

A

Profits earned by a company and not appropriated by dividends, taxation or transfer to another reserve account

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8
Q

Equity shares double entry

A

DR Bank
CR Share Capital
CR Share Premium

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9
Q

Redeemable preference shares double entry

A

DR Cash

CR Redeemable preference shares

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10
Q

Bonus issue =

A

Shares offered to existing shareholders (always offered at par (nominal) value

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11
Q

Bonus issue double entry

A

DR Share premium

CR Share capital

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12
Q

Rights issue =

A

Usually discounted shares offered to existing shareholders

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13
Q

Rights issue double entry

A

DR Bank
CR Share Capital
CR Share Premium

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