bonus share

Definition

Free shares of stock given to current shareholders, based upon the number of shares that a shareholder owns. While this stock action increases the number of shares owned, it does not increase the total value. This is due to the fact that since the total number of shares increases, the ratio of number of shares held to number of shares outstanding remains constant.

Use bonus share in a sentence

You may want to try and offer a bonus share if things have been going really great for your company recently.

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Because he was a long-time customer and employee, Fredrico received several bonus shares, a generous gift for his loyalty indeed.

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After my company split its stock, each employee who owned shares in the company received a free bonus share equivalent to the previous value.

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bonus issue bookkeeping transaction