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Hi Mike!
1.Could you explain the allotment of shares? And also a contract of allotment?
2. Is it the same as issue of shares?Share allotment is, so far as I AMA ware, synonymous with share allocation
It’s a rare occurrence these days but, when I was a student, there was a topic in my accounting syllabus called “Application and allotment of shares”
This is where a new company is coming to the market and applications are invited of people asking if they would like to apply to acquire shares in the company
Say 1 million shares were being offered and applications were received to buy 1,250,000 shares
The company then has the task of deciding who is to receive shares and who are going to be the unlucky ones … in other words, which applicants are going to have shares allotted to them
As I wrote earlier, it’s very rare these days.
Is it the same as issuing shares? So far as we are concerned nowadays, although there are technical differences (that you need not concern yourself with), yes, it’s effectively the same as issuing shares
OK?
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