Match List-I with List-II

List-I	List-II
(Book/Theory proposed/Characteristic, etc.)	(Author/Thinker/Name of Theory, etc.)
(A) Authorised Capital	(I) Only available to creditors at the time of winding up of a company
(B) Issued Capital	(II) The amount of capital that a company can raise in its life-time
(C) Subscribed Capital	(III) Capital that is issued to the public for subscription
(D) Reserve Capital	(IV) May be equal to or less than issued capital

Choose the correct answer from the options given below:

Understanding each type of share capital:

Authorised Capital is the maximum capital amount stated in the Memorandum of Association that a company is authorised to raise throughout its existence. This matches with (II) - "The amount of capital that a company can raise in its life-time"

Issued Capital is the portion of authorised capital that the company actually offers to the public. This matches with (III) - "Capital that is issued to the public for subscription"

Subscribed Capital is the portion of issued capital that investors actually agree to purchase. Since public may subscribe to the entire issued capital or only a part of it, subscribed capital is always equal to or less than issued capital. This matches with (IV) - "May be equal to or less than issued capital"

Reserve Capital is created by passing a special resolution to set aside a portion of uncalled capital. This amount can be called up only when the company is being wound up and is specifically kept for creditors' protection. This matches with (I) - "Only available to creditors at the time of winding up of a company"

The hierarchy flows as: Authorised Capital ≥ Issued Capital ≥ Subscribed Capital

The correct matching is:

• (A) → (II)
• (B) → (III)
• (C) → (IV)
• (D) → (I)

Correct Answer: Option 1