Sunday, February 1, 2009

Capital of a Company

The share capital of a company can be of the following divisions:
Authorized Capital: It is the amount, which has been mentioned in the memorandum of association. It is also the amount which is sanctioned by the controller of capital issue. Authorized capital empowers the company to issue share capital up to that limit and not beyond that.

Issued Capital: Issued capital represents the amount of the capital which has been issued.

Subscribed Capital: It is the sum total of applications received from public in response to prospectus issued. The subscribed may be more than, equal to or less than the issued capital.

Called up Capital: It is that part of issued capital which is called up from the applicants / shareholders. The company may call up the whole of the amount or less. In case the company calls less than the face value of the shares, the shares are said to be partly called-up.

Paid-up Capital: Paid-up capital is the amount of which actual payment has been made by the shareholders.

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