What does unpaid capital refer to?

Unpaid capital refers to the portion of share capital that has been issued to shareholders but has not yet been fully paid for. When a company issues shares, it may not require immediate payment for the entire amount due on those shares. This creates a liability for the shareholders, who are obligated to pay the remaining balance. Therefore, the correct understanding of unpaid capital is directly associated with this outstanding obligation.

The focus on the proportion of share capital that is still owed highlights an important aspect of corporate finance, as it allows the company to track how much money it is still expected to receive from its shareholders. This concept is crucial for understanding a company's financial health and the potential inflow of cash relevant for funding operations or investments.

Other options do not accurately reflect the definition of unpaid capital; for instance, selling shares refers to the total value already received, profits waiting to be distributed concern retained earnings rather than share capital, and repurchased shares indicate shares that a company has bought back, not shares that remain unpaid. Each of these alternatives relates to different aspects of capital structure or corporate activity, but they do not definitionally encapsulate what unpaid capital is.