Company Accounts

Share Capital

Easy

common

While issuing shares, the application money should be atleast ______ of face value.

20%

15%

10%

✅ Correct Option: 3

According to SEBI (Securities and Exchange Board of India) guidelines and the Companies Act provisions, when a company issues shares to the public, the minimum application money that must be collected is 5% of the face value of the shares.

Illustration:

If a company issues shares with a face value of ₹100, the minimum application money = 5% of ₹100 = ₹5

This requirement ensures that applicants demonstrate genuine interest in subscribing to the shares and helps reduce speculative or frivolous applications. The remaining amount can be collected through allotment money and call money as per the company's payment schedule.

Correct Option: 3 (5%)

2025: 31 May Shift 1

Interest on calls in advance is provided at a rate not exceeding ........ as per "Table F":

2025: 27 May Shift 2

Shares can be forfeited:

2025: 15 May Shift 1

The important steps in the procedure of share issue are :

(A) The company issues the prospectus to the public.

(B) The company has to get minimum subscription within 120 days from the date of the issue of the prospectus.

(C) The prospective investors intending to subscribe the share capital of the company would make an application along with the application money.

(D) Letters of allotment are sent to those whom the shares have been alloted, and letters of regret to those to whom no allotment has been made.

Choose the correct sequence of steps from the options given below:

2025: 2 June Shift 2

In the case of under subscription of shares.

2026: 20 May Shift 1

Raj Ltd. purchased a machine from Anuj Tech Ltd. for Rs.1,90,000. As per purchase agreement, Rs. 10,000 were paid in cash and balance by issue of shares of Rs.100 each. Find the number of shares issued to Anuj Tech Ltd., if the shares issued at 20% premium.

2026: 20 May Shift 1

Arrange the following in a sequence related to the issue and redemption of shares

(A) Forfeiture of shares

(B) Reissue of shares

(D) Transfer of share forfeited account balance to capital reserve A/c

Choose the correct answer from the options given below:

While issuing shares, the application money should be atleast ______ of face value.

Solution

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