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Is bonus share a gain

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Anonymous

14y ago
Updated: 8/19/2019

It is a Share

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Wiki User

14y ago

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What is the effect of a bonus issue on the share capital and share premium account?

Bonus shares increases the share capital while reduces the share premium account because amount of share premium is used to issue bonus shares.


Does share capital change when bonus share issued?

When bonus shares are issued share capital also change as amount from retained earnings or reserves is utilized to issue bonus shares and it increase the share capital while decrease the reserves or retained earnings.


What is bonus in stock market?

A bonus share is nothing but free shares of the company in which you already hold shares that are given to you by the company for being a share holder of the company. Lets say you hold 100 shares of XYZ company and the company declares a 1:1 bonus (that is you get 1 share for every 1 share of that company you hold) So once the bonus is declared, you would be holding 200 shares instead of 100. you had bought only 100 the extra hundred is the bonus.


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sharing a bonus on zynga poker posts a message on your wall and people can click claim bonus and it gives them a few bonus chips on your behalf, but it wont deduct from your chip stack :)


Can you use revaluation reserve to issue share capital?

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What is the difference between Bonus Shares and Shares split?

in case of bonus shares the value of the share decreases proportionate to the number of bonus shares issued. for eg: if company issues bonus shares in ratio of 1:1 and the price of share is 900 , then after bonus issue, the corresponding value of the share gets Rs. 450.genreally company issue this in place of giving dividends.the market captalisation doesnt get affected. as if shares doubles the prices is halved. whereas in split shares the face value of share decreases. generally the face value of share is 10 Rs. but face value can be high. eg: if face value is 100 Rs. then company can split d share in ratio of 100:10. ..now the person holding 100 shares of rs 100 now will hold 1000 shares of 10 Rs each. now shares can be traded more frequently and this will in turn increase the liquidity of the share