Company Accounts

Share Capital

Easy

While issuing the share capital for public subscription, the application money should be at least _____ % of the face value of the share.

25%

10%

15%

✅ Correct Option: 2

According to the Companies Act, 2013 and SEBI regulations, when a company issues shares for public subscription, the minimum application money must be at least 5% of the face value of the share.

This means if a company issues shares with a face value of ₹10, the minimum amount to be collected at the application stage would be:

Application Money = 5% of ₹10 = ₹0.50 per share

This requirement ensures that applicants show genuine interest by paying a minimum amount upfront, while also preventing companies from collecting excessive amounts at the application stage that might burden investors if their applications are rejected.

The remaining amount (95% or less, depending on how much is collected at application) is collected in subsequent stages like allotment, first call, second call, and final call as per the company's payment schedule.

Correct Answer: Option 2 (5%)

2026: 21 May Shift 1

The correct order of the following events is:

(A) Forfeiture of shares

(B) Capital Reserve

(D) Reissue of shares

Choose the correct answer from the options given below:

2026: 11 May Shift 2

____________is available only for the creditors on winding up of the company

2026: 21 May Shift 2

If the value of purchase consideration payable to the vendor is less than the value of the net assets taken over by the company, the difference will be credited to:

2025: 31 May Shift 1

Jindal and Company purchased a machine from High Life Machine Limited for Rs.3,80,000. As per purchase agreement, Rs. 20,000 were paid in cash and balance by issue of shares of Rs.100 each. Find the number of shares issued, if they are issued at par:

2026: 31 May Shift 1

In case of issue of shares, there must be an interval of at least ..........month (s) between the making of two calls unless otherwise provided by the articles of association of the company.

2022: 30 Aug Shift 2

The company issued 20,000 equity shares of Rs. 10 each to vendor. After issuing them the shares the vendor will be considered as:

While issuing the share capital for public subscription, the application money should be at least _____ % of the face value of the share.

Solution

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