Saturday 30 September 2017

Investopedia/Claire Boyte-White: Issued Share Capital vs. Subscribed Share Capital

Issued Share Capital vs. Share Capital

By Claire Boyte-White | Updated August 7, 2017 — 10:01 AM EDT


Subscribed share capital, which is what investors have expressed an interest in, is very different from issued share capital, which is the actual issued stock.

Share capital refers to the amount of funding a company raises through the sale of shares of stock to public investors. Share capital constitutes the main source of equity financing and can be generated through the sale of common or preferred shares.

Though share capital refers to a dollar amount, it is dictated by the number and selling price of a company's shares. For example, if a company issues 1,000 shares for $25 per share, it generates $25,000 in share capital. Share capital falls into one of several categories, depending on where the company is in the equity-raising process. They include:

Called-Up Vs. Paid-Up Share Capital: Depending on the business and applicable regulations, companies may issue stock to investors with the understanding the investors will pay at a later date. Any funds due for shares issued but not fully paid for are called-up share capital. Any funds remitted for shares are considered paid-up capital.
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