Question

Bonus Shares are issued to–

(A) Equity Shareholders
(B) Preference Shareholders
(C) Debenture Holders
(D) Secured Creditors

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Answer 1

Answer:

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Explanation:

Bonus issues are given to shareholders when companies are short of cash and shareholders expect a regular income. Shareholders may sell the bonus shares and meet their liquidity needs. Bonus shares may also be issued to restructure company reserves. Issuing bonus shares does not involve cash flow.