- Corporate
or Company
Corporate or company is the synonym. Company means association of person
which do any business for earning profit. But it must register and formed under
any company law of any country. Because company is an artificial person and do
work with separate entity. Company has its own charter and internal article of
association.
- Shares
This is main term of corporate accounting. When we divide total capital
of company into parts then each part is called share. Suppose, if you have
100000 capitals and if you divide into 1000 parts. Then it means company has
1000 shares of 100 rupees each.
- Preference
Shares
Preference shares are the main type of shares if company issues that
type of shares, then the share holder of these types of shares has the benefit
that they can get part of profit with fixed rate and before giving the part of
profit to equity shareholders. In the end of company, these shares are get
preference of their repayment.
- Equity
Shares
Equity Shares are the shares which are differ from preference shares.
The shareholder of these shares has no preference relating getting dividend or
any repayment. They are real owner of company and have the right to give the
vote.
- Dividend
Dividend is that part of profit which distribute among shareholder. Its
other name is divisible profit. Dividend may be given by cash or through bonus
or any other type.
- Debenture
Debenture is just paper which is given by company when company takes
loan from public. It is issued under company seal. In this paper company
accepts that he will repay the loan taken by him after certain period with
given rate of interest.
- Redemption
Redemption is technical term in corporate accounting .It means repayment
of loan taken by company. When company issued debenture then company also
writes the mode of redemption of debenture. There are different ways of
redemption of debenture. The best way is to create sinking fund and keep some
part of profit in it as annual installment. So that company can pay his taken
loan without any tension.
- General
Reserve
General reserve is the part of retained profit. It is very compulsory to make general reserve in company for payment of contingent liabilities or for development of company. Every finance bill has right to amend or change the rate of % in general reserve. This part is not issued as dividend
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