define share and various kinds of share and share capital.
share - A share is a percentage of ownership in a company. in simple term A company's capital is divided into equal units, each units is known as share . it represents unit of ownership of the company. A person who hold shares of any company is called shareholders.
Ex. If market capitalization of company is Rs. 1 lakh, and price of single share is Rs.20 then the shares are 5000.
Kinds of shares-
1. Equity share.
2. Preference share .
3.Differential Voting Right (DVR) shares.
Description-
1. Equity shares - An equity shares are ordinary shares. Equity share holders are entitled to get dividends of company. equity shareholder receive dividends after preference shareholders. This type of share holders have right to vote in the company's meeting.
2. Preference shares - Preference share are same as its name. Preference share holders get first preference in the profit of company than ordinary share holders. Preference share holders have the first right in terms of getting repaid, when the company winds up.
3. Differential Voting Right (DVR) shares- Differential Voting Right (DVR) Shares are those shares that give the share holders of the shares the differential rights related to voting. Companies provide extra dividend to DVR shareholders to dilute the voting privileges. They have less voting rights compared to equity shareholders.
Share capital :- Share capital is the part of the capital of a company or the amount that a company raises by the issuance of common or preferred stock. It is different from shareholders equity because it does not include retained earning.
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