Accounting for Share Capital

Share Capital
Funds raised by company by issue of shares.
Two types:
Equity Share
A share that provides voting rights to its holders, belong to owners of the company, carries maximum risk and return, in which dividend is not fixed and on winding up of the company the holders of these shares receive only what is left after paying off all the liabilities and obligations of the company including Preference Shareholder repayment.
Preference Share
A share which carries a preferential right to get fixed dividend over equity shares to its holders and repayment of capital before holders of equity share capital. It does not carry voting right.
Classification of Share Capital
Authorised or Nominal Capital
Maximum amount of share capital that a company can raise as per Memorandum of Association.