The maximum amount a company can raise through the issue of shares is
Question 1 Report
The maximum amount a company can raise through the issue of shares is
Answer Details
The maximum amount a company can raise through the issue of shares is the "authorized capital."
Authorized capital is the maximum amount of share capital that a company is authorized to issue as stated in its Memorandum of Association. This represents the total amount of money that the company can raise by issuing new shares to investors.
It is important to note that authorized capital is not the same as paid-up capital. Paid-up capital is the actual amount of money that has been paid by shareholders for the shares they have subscribed to. In other words, it is the amount of money that has been received by the company from the sale of its shares.
Therefore, the authorized capital represents the upper limit of the amount of money that a company can raise by issuing new shares, while the paid-up capital represents the actual amount of money that the company has received from its shareholders.
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