A companys share with a face value of 10 &after it is decreased to 5, then the no. of share decreases or incre
Answer:
perhaps u can rephrase the question.
from what i understand if u want 2 know what happens when a co. has shares of Rs.10 and then reduces that 2 Rs.5, and assuming u want it in the light of the companies act,1956 (india)there are 2 possible cases.
assuming that there is only an alteration of share capital with no reduction of liability of shareholders, section 94 comes into play. in this case the no. of share increases to twice the no. of shares previously held as the amount of total share capital remains the same.
assuming that there is an accompanying reduction of liability of shareholders, section 100 takes effect. in this case the no. of shares remain the same, though the nominal value of shares has decreased from 10 to 5.
however i feel your case belongs to section 94.
The number of shares remains the same. The vaule of each share changes.
That is nothing but share split. Number of share will increase.
number of shares remains same but their value comes down.
Nowadays all companies subdivide their shares so that it can be easily marketable in exchange.We have seem most cos have subdivided Rs 10 paid up value share to 10 shares of Rs 1 each
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