Company Accounts

Share Capital

Easy

Comprehension:

Read the following passage and answer the questions

On January 1, 2024, the Director of X Ltd. issued for public subscription 50,000 equity shares of Rs. 10 each at Rs. 12 per share payable, Rs. 5 on application (including premium), Rs. 4 on allotment and the balance on call on May 01, 2024. The issue was closed on February 10, 2024 by which date applications for 70,000 shares were received. Of the cash received Rs. 40,000 was returned and Rs. 60,000 was applied to the amount due on allotment, the balance of which was paid on February 16, 2024. All the shareholders paid the call due on May 01, 2024 with the exception of an allottee of 500 shares. These shares were forfeited on September 29, 2024 and reissued as fully paid at Rs. 8 per share on November 01, 2024. The company, as a matter of policy, does not maintain a calls-in-arrears account.

What amount will be credited to Equity Share Application Account on February 10, 2024?

Rs. 2,50,000

Rs. 3,00,000

Rs. 3,50,000

Rs. 450000

✅ Correct Option: 3

The company received applications for 70,000 shares by February 10, 2024, with Rs. 5 payable per share on application (including premium).

Calculation:

Total application money received = Number of shares applied × Amount per share on application

Total application money received = 70,000 × Rs. 5 = Rs. 3,50,000

The Equity Share Application Account is credited with the total amount received from all applicants on the date applications are received. This represents the gross inflow before any adjustments like refunds or transfers to allotment account.

The subsequent treatment (Rs. 40,000 returned to rejected applicants and Rs. 60,000 transferred to allotment account for excess application money) happens after this initial credit entry when dealing with oversubscription, but does not affect the total amount initially credited to the Application Account.

Answer: Rs. 3,50,000 (Option 3)

2025: 27 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Interest on calls in arrears	(I) Preference Shares
(B) Interest on calls in advance	(II) OPC
(C) Sec.2(62) of The Companies Act, 2013 defines	(III) 12%
(D) Sec.43 of The Companies Act, 2013 defines	(IV) 10%

Choose the correct answer from the options given below:

(A) - (IV), (B) - (III), (C) - (I), (D) - (II)
(A) - (IV), (B) - (III), (C) - (II), (D) - (I)
(A) - (II), (B) - (I), (C) - (IV), (D) - (III)
(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

2025: 14 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Issued Capital	(I) It is that part of the issued capital which has been actually subscribed by the public.
(B) Uncalled Capital	(II) Capital which can be called only in the event of winding up of the company.
(C) Reserve Capital	(III) That portion of the subscribed capital which has not yet been called up.
(D) Subscribed Capital	(IV) It is that part of the authorised capital which is actually issued to the public for subscription

Choose the correct answer from the options given below:

2022: 8 Aug Shift 2

When shares are forfeited, capital account is debited by:

2026: 11 May Shift 2

Applications Supported by Blocked Amount (ASBA) is a process developed by.......................to apply for subscribing to IPOs and Rights Issue etc. of securities.

2025: 27 May Shift 2

A company purchase its own shares of Rs 5,00,000 from the market. What this process is called ?

2025: 2 June Shift 2

Which of the following statements are true with reference to a "company"?

(A) The directors of the company are the owners of the company.

(B) A company is an artificial person.

(D) The liability of the members of the company is limited to the extent of shares held by them

Choose the correct answer from the options given below:

What amount will be credited to Equity Share Application Account on February 10, 2024?

Solution

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