2 Theory Share Capital Transactions Video Lecture | Commerce & Accountancy Optional Notes for UPSC

1. What are the different types of share capital transactions?$#

Ans. Share capital transactions include issuing new shares, repurchasing shares, and transferring shares between shareholders.

2. How does issuing new shares impact a company's share capital?$#

Ans. Issuing new shares increases a company's share capital as more shares are being issued to investors, thereby raising additional funds for the company.

3. What is the significance of repurchasing shares for a company's share capital?$#

Ans. Repurchasing shares reduces a company's share capital as the company buys back its own shares from existing shareholders, leading to a decrease in the total number of shares outstanding.

4. Can share capital transactions affect a company's financial position?$#

Ans. Yes, share capital transactions can impact a company's financial position by altering the total equity of the company and influencing key financial ratios.

5. How are share capital transactions recorded in a company's financial statements?$#

Ans. Share capital transactions are typically recorded in the equity section of a company's balance sheet, with details provided in the notes to the financial statements.