WHAT IS THE MEANING OF SHARE CAPITAL, PAID UP CAPITAL & ISSUED SHARE CAPITAL?

Paid Up Capital

Paid up Capital simply refers to the money received from the sales of shares to the shareholders. A fully paid up company is when all available shares are sold. The paid up can be less than the company’s total capital because the company may not issue all of the shares that are available for sales.

 

Issued Share Capital

The company issued shares to the shareholder in exchange of cash or other considerations. It represents the allotment of shares to the shareholders. 

 

Share Capital

The Share Capital is the amount that the original shareholders purchased from the issuing company initially. It will be reflected in the balance sheet when the financial statements are being prepared. However, any differences in price through the appreciation or depreciation of shares by transaction in secondary market will not be included. The company can increase its share capital because each time a business sells new shares to the public in exchange for cash, the amount of share capital will increase. Share capital can be composed of both ordinary and preferred shares. 

 

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