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What is called a "Bonus Share" ? For What purpose Bonus Shares are issued?

Accounting Financial Accounting Financial Management
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Question added by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.
Date Posted: 2014/09/13
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Divyesh Patel
by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town

A bonus share is a free share of stock given to current shareholders in a company, based upon the number of shares that the shareholder already owns.

Issue of bonus shares is a way for the company to maintain the shares at a cheaper rate without splitting the stocks.

 

Khaled Mohee Eldeen Abbas Mahmoud
by Khaled Mohee Eldeen Abbas Mahmoud , Chartered Accountant # 10465 , Self-employed

Bonus share 

shares issued to stockholders in a stock split, with at least one more share for every share owned, without affecting the total value of each holding.

in the United Kingdom, extra shares paid by the government as a reward to founding stockholders who did not sell their initial holding within a specific number of years

georgei assi
by georgei assi , مدير حسابات , المجموعة السورية

  The process of raising capital by issuing shares at par value of the shares and the value is converted these shares issued from the reserve and added to the capital. The purpose of this process If so what if interest from the issuance of new shares and a capital increase. Explains some of the journalists and even some corporate managers to increase capital for the purpose of expansion and this manifest error process has not resulted in any change in the company's financial position nor in the size of the cash flows, nor in the amount of cash available did not change the obligations of the company, if the company is able to expand self after the increase They certainly were able to do the same thing before the increase. The truth is that the only reason for this process is activating the movement of stock trading and make it accessible to most traders and that the capital increase, thereby increasing the number of shares result in a reduction in the value of the stock the same percentage increase in the number of shares because the increased number of shares resulting in lower earnings per share and book value and all indicators share the same percentage increase in the number of shares.

FITAH MOHAMED
by FITAH MOHAMED , Financial Manager , FUEL AND ENERGY CO for transportion petroleum materials

agree with all answers

thanks 

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