A Bonus Share Issue Does Not Actually Transfer Any Value

question 51

True/False

A bonus share issue does not actually transfer any value to the company's shareholders.

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Definitions:

Legal Capital

The minimum amount of capital that a company is required to maintain by law, often to protect creditors from the company's potential losses.

Treasury Stock

Treasury stock refers to shares that were once part of the outstanding shares of a company but were repurchased by the company itself.

Treasury Stock

Shares of a company's own stock that it has reacquired from shareholders but not retired, thus reducing the amount of outstanding stock on the open market.

Cash Dividend

A cash distribution given to shareholders from a company's earnings.