How does a bonus share issue differ from a share split?
A) They do not differ; they are both issuing new shares to existing shareholders.
B) Bonus share issues distribute value to existing shareholders; share splits remove value from existing shareholders.
C) Bonus share issues are usually issued as a percentage of existing shares, whereas a share split is usually issued as a multiples of existing shares.
D) None of the above.

Question

Quizplus · Accepted Answer

A share split is quite similar to a bonus share issue, but it involves the distribution of a larger multiple of the outstanding shares. When a company pays a bonus share, it distributes new shares on a pro-rata basis to existing shareholders.

How Does a Bonus Share Issue Differ from a Share