Types of capital - SS2 Commerce Past Questions and Answers - page 1
What does authorized capital represent?
The maximum amount of capital a company can issue
The portion of issued capital that shareholders have paid
The residual value of a company's assets
Which type of capital represents the actual value of shares issued to shareholders?
Authorized capital
Issued capital
Called-up capital
What is called-up capital?
The maximum amount of capital a company can issue
The portion of issued capital that shareholders have paid
The portion of issued capital that shareholders have paid
The portion of issued capital that shareholders have paid
What does capital owned (shareholders' equity) represent?
The maximum amount of capital a company can issue
The portion of issued capital that shareholders have paid
The net value of a company's assets belonging to shareholders
The net value of a company's assets belonging to shareholders
Define authorized capital in simple terms.
Authorized capital represents the maximum amount of capital a company is allowed to issue.
What does capital owned (shareholders' equity) include?
Capital owned includes the initial investment made by shareholders (issued and called-up capital) and any retained earnings or profits generated by the company over time.