Question

Total number of shares into which the authorised share capital of the company is divided, is:

• A. 10,00,00,000
• B. 1,00,00,000
• C. 10,00,000
• D. 3,00,000
• A. Rs 2,99,50,000
• B. Rs 3,00,00,000
• C. Rs 10,00,00,000
• D. Rs 2,99,90,000
• A. Rs 2,99,90,000
• B. Rs 2,99,50,000
• C. Rs 3,00,00,000
• D. Rs 40,000
• A. Rs 3,00,00,000
• B. Rs 2,99,50,000
• C. Rs 2,99,90,000
• D. Rs 10,00,00,000
• A. Rs 10,000
• B. Rs 40,000
• C. Rs 50,000
• D. Rs 5,000
• A. Rs 35,000
• B. Rs 40,000
• C. Rs 10,000
• D. Rs 50,000

Answer 1

The Correct Option is C

Step 1: Formula:
Number of shares = authorised capital / face value of one share.

Step 2: Put in the figures:
Authorised capital = Rs. 10,00,00,000 and face value = Rs. 100.
Shares = 10,00,00,000 / 100 = 10,00,000.
This is option (C).

Step 3: Why the other options are wrong:
Option (A), 10,00,00,000, is wrong. It is the authorised capital in rupees, not the number of shares.
Option (B), 1,00,00,000, is wrong. It is one tenth of the authorised capital and comes from a wrong division.
Option (D), 3,00,000, is wrong. It is the number of shares issued to the public, which is only a part of the authorised shares.

Final Answer:
The authorised capital is divided into 10,00,000 shares, option (C).

Answer 2

Step 1: Find the call amount:
Application Rs. 30 + allotment Rs. 50 = Rs. 80 per share.
First and final call = 100 - 80 = Rs. 20 per share.

Step 2: Find the fully paid shares:
Shares issued = 3,00,000. Raman holds 500 shares and did not pay the call.
Fully paid shares = 3,00,000 - 500 = 2,99,500.

Step 3: Capital on fully paid shares:
2,99,500 x Rs. 100 = Rs. 2,99,50,000.
This is option (A).

Step 4: Why the other options are wrong:
Option (B), Rs. 3,00,00,000, is wrong. It is the called-up capital on all 3,00,000 shares before the unpaid call is found. The question asks for the subscribed and fully paid-up capital.
Option (C), Rs. 10,00,00,000, is wrong. It is the authorised capital in rupees, not the number of shares. The question asks for the subscribed and fully paid-up capital.
Option (D), Rs. 2,99,90,000, is wrong. It is the paid-up share capital that goes to the Balance Sheet (2,99,50,000 + 40,000). The question asks for the subscribed and fully paid-up capital.

Final Answer:
Subscribed and fully paid-up capital is Rs. 2,99,50,000, option (A).

Answer 3

Step 1: Amount paid per share:
Raman paid application Rs. 30 and allotment Rs. 50, so Rs. 80 per share.
He did not pay the first and final call of Rs. 20.

Step 2: Capital on the 500 shares:
500 shares x Rs. 80 = Rs. 40,000.
This is the amount paid up on shares that are not fully paid. It is option (D).

Step 3: Why the other options are wrong:
Option (A), Rs. 2,99,90,000, is wrong. It is the paid-up share capital that goes to the Balance Sheet (2,99,50,000 + 40,000). The question asks for the subscribed but not fully paid-up capital.
Option (B), Rs. 2,99,50,000, is wrong. It is the capital on the 2,99,500 fully paid shares (2,99,500 x Rs. 100). The question asks for the subscribed but not fully paid-up capital.
Option (C), Rs. 3,00,00,000, is wrong. It is the called-up capital on all 3,00,000 shares before the unpaid call is found. The question asks for the subscribed but not fully paid-up capital.

Final Answer:
Subscribed but not fully paid-up capital is Rs. 40,000, option (D).

Answer 4

Step 1: Rule:
The Balance Sheet shows only the paid-up share capital.
Calls in arrears are deducted from the called-up amount.

Step 2: Add the two parts:
Subscribed and fully paid-up = Rs. 2,99,50,000.
Subscribed but not fully paid-up = Rs. 40,000.
Share capital = 2,99,50,000 + 40,000 = Rs. 2,99,90,000.

Step 3: Match the option:
Rs. 2,99,90,000 is option (C).

Step 4: Why the other options are wrong:
Option (A), Rs. 3,00,00,000, is wrong. It is the called-up capital on all 3,00,000 shares before the unpaid call is found. The question asks for the share capital shown in the Balance Sheet.
Option (B), Rs. 2,99,50,000, is wrong. It is the capital on the 2,99,500 fully paid shares (2,99,500 x Rs. 100). The question asks for the share capital shown in the Balance Sheet.
Option (D), Rs. 10,00,00,000, is wrong. It is the authorised capital in rupees, not the number of shares. The question asks for the share capital shown in the Balance Sheet.

Final Answer:
Share capital in the Balance Sheet is Rs. 2,99,90,000, option (C).

Answer 5

Step 1: What is credited:
On forfeiture the amount already received on the shares goes to Share Forfeiture Account.

Step 2: Amount received on 500 shares:
Paid per share = Rs. 30 + Rs. 50 = Rs. 80.
Total = 500 x Rs. 80 = Rs. 40,000.
This is option (B).

Step 3: Why the other options are wrong:
Option (A), Rs. 10,000, is wrong. It is the unpaid first and final call of Rs. 20 on 500 shares. The question asks for the Share Forfeiture Account.
Option (C), Rs. 50,000, is wrong. It is the face value of 500 shares at Rs. 100 each. The question asks for the Share Forfeiture Account.
Option (D), Rs. 5,000, is wrong. It is a figure that matches no step of this case. The question asks for the Share Forfeiture Account.

Final Answer:
Share Forfeiture Account is shown at Rs. 40,000, option (B).

Answer 6

Step 1: Amount forfeited per share:
Raman paid Rs. 30 + Rs. 50 = Rs. 80 per share.
So Share Forfeiture Account has Rs. 80 per share.

Step 2: Discount on reissue:
Each share is reissued at Rs. 90 as fully paid up, though its face value is Rs. 100.
Discount = 100 - 90 = Rs. 10 per share.

Step 3: Capital Reserve:
Capital Reserve is the forfeited amount that remains after the discount.
Per share = Rs. 80 - Rs. 10 = Rs. 70.
For 500 shares = 500 x 70 = Rs. 35,000. This is option (A).

Step 4: Why the other options are wrong:
Option (B), Rs. 40,000, is wrong. It is the amount already received on the 500 shares (Rs. 80 x 500). The question asks for the Capital Reserve on reissue.
Option (C), Rs. 10,000, is wrong. It is the unpaid first and final call of Rs. 20 on 500 shares. The question asks for the Capital Reserve on reissue.
Option (D), Rs. 50,000, is wrong. It is the face value of 500 shares at Rs. 100 each. The question asks for the Capital Reserve on reissue.

Final Answer:
Capital Reserve is Rs. 35,000, option (A).