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profitability
It increase liquidity.
Nominal share capital is like an authorized share capital. The share capital that the company allowed (the maximum amount) to issue as registered capital when the company is incorporated. It can be changed later by the approval of the shareholders.
1.cumulative preference share capital 2.non cumulative preference share capital 3.participative preference share capital 4.non participative preference share capital
Preference share capital means share capital which have preference over all other kind of share capital in term of profit and clearance at the time of dissolution of business.
profitability
Disadvantage of share capital is that it increases the risk of default which causes the increase in cost of capital.
No
It increase liquidity.
[Debit] Cash / bank [Credit] Share capital
When bonus shares are issued share capital also change as amount from retained earnings or reserves is utilized to issue bonus shares and it increase the share capital while decrease the reserves or retained earnings.
Bonus shares increases the share capital while reduces the share premium account because amount of share premium is used to issue bonus shares.
debit cashcredit share capital
Yes share issue increase current assets as we received cash against share issuance and the general entry is: [Debit] Cash xxxxx [Credit] Share Capital xxxx
Share Capital is the amount invested by the owners of business into the business.Drawings is the amount withdrawn by the owners of business.So it is not surprise to show the drawings from deduction from the share capital because net effect is the reduction of the share capital of the owners of the business.
Yes if company has to maintain certain debt equity ratio then it can affect the borrowing power as more share capital will be adjusted to correspondant debt ratio.
1. A company wants to increase capital using equity financing will involve in issuing share capital to public for subscription.