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Question
Explain the following term/concept:
Capitalisation of Reserves
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Solution
(1) The process of issuing the bonus shares out of the company's profits or reserves is known as "Capitalisation of Profits or Reserves.
(2) It is a reward to shareholders, distributed in proportion to the number of shares each owns. The process has no impact on a corporation book value.
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RELATED QUESTIONS
Select the correct answer from the options given below and rewrite the statement.
Registered shareholders receive dividend through ______ warrant.
Select the correct answer from the options given below and rewrite the statement.
Dividend is paid out of ______ of the company
______ is issued by the company to its registered shareholders after the declaration of dividend at the Annual General Meeting of the company.
Match the pairs.
| Group 'A' |
Group 'B' |
|
a. Dividend Warrant |
1. Instrument for payment of Interest |
|
b. Return on Shares |
2. Capitalisation of Building Fund |
|
c. Bonus Shares |
3. Electronic Clearing Service |
|
d. ECS |
4. Capitalisation of Reserve Fund |
|
e. NEFT |
5. National Electronic Fund Transfer |
|
6. Dividend |
|
|
7. Electronic Co-operative Society |
|
|
8. National Electronic Fixed Transfer |
|
|
9. Instrument for Payment of Dividend |
|
|
10. Interest |
Write a word or a term or a phrase which can substitute the following statement.
Shares given free of cost to the existing equity shareholders.
Write a word or a term or a phrase which can substitute the following statement.
The authority which recommends the rate of dividend.
Write a word or a term or a phrase which can substitute the following statement.
A special kind of cheque issued by a company on its banker to pay certain sum of money as dividend to its members.
State whether the following statement is true or false.
Building fund is used for issue of bonus shares.
State whether the following statement is true or false.
Every company must issue or despatch a share certificate to the allottee within three months after allotment of shares.
Find the odd one.
Complete the sentence.
The ______ has to communicate the decisions of the management to the members by conducting correspondence.
Select the correct option from the bracket.
| Group ‘A’ |
Group ‘B’ |
|
a) Return on share |
1. ______ |
|
b) Capitalisation of Reserve Fund |
2. ______ |
|
c) Correspondence |
3. ______ |
|
d) ______ |
4. Payment of Dividend Electronically |
Answer in one sentence:
Who recommends the rate of dividend ?
Explain the following term/concept:
Dividend Warrant
Which precautions are to be taken by the Secretary while corresponding with members?
Justify the following statement
The Company Secretary should take certain precautions while corresponding with members
Explain the following term/concept.
Correct information
Select the correct option from the bracket.
| Group ‘A’ | Group ‘B’ | ||
| a) | Return on shares | 1 | ______ |
| b) | Capitalization of reserve fund | 2 | ______ |
| c) | First depository of world | 3 | ______ |
| d) | ______ | 4 | payment of dividend electronically |
| e) | ______ | 5 | Buying and selling of existing securities |
(Germany, Bonus shares, Secondary market, Dividend, ECS)
