Friday, 11 March 2011

Kinds or Classes of Share Capital

Share capital:-
The represent the total amount of shares subscribed by the shareholders for the purpose of the company.

Classes of Share Capital

It may be divided into the following classes:

1. Authorized Registered, or Nominal Capital:-
This represents the total amount of the share capital authorized by the Memorandum of Association and which the company has power to issue.

2. Issued Capital:-
This is the capital consisting of the number of shares that have been offered to the public for subscription for cash and to the vendors as fully or partly paid.

3. Un Issued Capital:-
This represent the amount of authorized capital of the company which has not yet been allotted and which may be issued at any time.

4. Called Capital:-
This is amount of money called up on the shares actually subscribed.

5. Uncalled up Capital:-
This is portion of subscribed capital which has not yet been called up by the company.

6. Paid up Capital:-
This is the portion of called up capital which has actually been up the shareholders.

7. Calls in Arrears:-
This represent the difference between the called up capital and the paid up.

8. Reserve Capital:-
This the portion of subscribed capital which has not been called up except in the event and for the purpose of winding up.

9. Loan Capital:-
Really this is not capital but this represent the creditors of the company. So loan capital is sometimes applied to debentures and other loans taken by a company for fixed period.

10. Capital Assets :-
The property of the company is called capital assets. It has two kinds, working capital and fixed capital.


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