Owned Capital Borrowed Capital


Owned Capital
Borrowed Capital
1.      Meaning: -
The funds collected by a company through issue of equity shares and preference shares and Ploughing back of profit are called owned capital.
2.      Return on investment: -
The contributors to the share capital get dividend as the return on their investment.
3.      Status of supplier:-
The contributors to the owned capital are the co-owners or the joint owners of the company.
4.      Voting Rights:-
The contributor to the owned capital has a right to vote at the general meetings on all the matters..
5.      Redemption: -
Repayment or redemption of the owned capital is made only at the time of the winding-up of the company.
1.      The fund collected by a company through the issue of debentures, accepting public deposits and borrowing from the banks and financial institutions are called borrowed capital.

2.      The contributors to the borrowed capital get interest as the return on their investment.

3.      The contributors to the borrowed capital are the creditors of the company.

4.      The contributor to the borrowed capital does not have voting rights.

5.      Repayment or redemption of the borrowed capital is made on the maturity or redemption date.