What Is It Called When Reserves Are Incorporated into the Share

question 28

Multiple Choice

What is it called when reserves are incorporated into the share capital?

• A) Cancellation
• B) Incorporation
• C) Capitalization
• D) Reservation

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Definitions:

Operating Cycle

The Operating Cycle refers to the period of time it takes for a company to purchase inventory, sell the products, and turn the sales into cash.

Classified Balance Sheets

Balance sheets that organize assets and liabilities into subcategories, such as current and non-current, to provide a clearer financial picture.

Long-Term Investments

Assets that a company intends to hold for more than one fiscal year, such as stocks, bonds, or real estate.

Intangible Assets

Non-physical assets with value to a business, such as trademarks, patents, goodwill, and copyrights.