Difference between Net worth and share capital



1
As you explained , Net worth of a company is the share holder Equity.

But in the Debt/ Equity Ratio .
The Equity here is the share capital .Can you more elaborately explain this share capital.

Why and how will a Promoter put money in the business which is listed and its mapping as a share capital.

Thanks
Vishal

3 Answer(s)


0

Promoters investment in the company (share capital) is only 1 component of shareholder equity. There are other components to shareholder equity such as Retained Earnings etc

0

Promoters invest money in the company during the early stages to fund the company's operations. After a few years promoters and other external investors can invest more cash as share capital.

0

networth is an asset and share capital is a liability to the company

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