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Question
Explain the following term/concept:
Bonus Shares
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Solution
(1) Bonus issues refer to the fully paid-up shares given to its existing equity shareholders without any cost, based upon the number of shares they are own. It is given at free of cost.
(2) For this purpose, a certain proportion is decided. For instance, if a person holds 100 shares and the company declares 1:2 bonus issues, then for every 2 shares held, he gets 1 share for free of cost.
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