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Question
ABC company plans to capitalise on its undistributed profits. Which one of the following shares will the company issue to its existing shareholders?
Options
Rights shares
ESOP
Sweat Equity Shares
Bonus Shares
MCQ
Solution
Bonus Shares
Explanation:
Bonus shares are fully paid shares provided to current shareholders free of charge based on their shareholding. The issuance of bonus shares is also known as the capitalization of undistributed earnings.
shaalaa.com
Finance for a Joint Stock Company - Bonus Shares
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