Accounting for Share Capital

Total No. of Questions: 10 Total Marks: 40

SECTION 1: MCQ
Q1 ABC Inc issues 30, 000 shares of Rs.1 at Rs1.30 for each share. Which of the following statement (4 Marks)
is true?
Ordinary share capital will increase by Rs.30, 000 and share premium will increase by Rs.
A.
39, 000.
B. Ordinary share capital will increase by Rs.39, 000 and share premium will increase by Rs.9, 000
.
C. Ordinary share capital will increase by Rs.39, 000 and share premium will be unaffected.
Ordinary share capital will increase by Rs.30, 000 and share premium will increase by Rs.
D.
9, 000.

Q2 When any shareholder pay any call money in advance then the A/c to be credited would be (4 Marks)
_________.
A. calls in advance A/c
B. pre-paid A/c
C. suspense A/c
D. goodwill A/c

Q3 X Ltd. purchased an automatic bottling machine from a vendor for Rs.165, 000. The company (4 Marks)
allotted him equity shares at a premium of 10% instead of paying him in cash. How many equity
shares will be allotted to the vendor if the company allotted the shares at 10% discount?
A. 18, 333
B. 17, 655.76
C. 17, 650
D. 18, 180

Q4 When company issues shares to vendors of assets for a consideration other than cash such shares are (4 Marks)
issued:
A. At par
B. At a discount
C. At a premium
D. Any of the above

Q5 To receive calls in advance it should be ___________. (4 Marks)

A. authorized by articles of association
B. authorized by special resolution
C. sanctioned by central government
D. all of the above

Q6 10, 000 equity shares of Rs. 10 each were issued to public at a premium of Rs. 2 per share. (4 Marks)
Applications were received for 12, 000 shares. Amount of securities premium account will be
________.
A. Rs. 20, 000
B. Rs. 24, 000
C. Rs. 4, 000
D. Rs. 1, 600

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Q7 When shares are issued to promoters which account should be debited ? (4 Marks)
A. Share Capital A/c
B. Assets A/c
C. Promoters A/c
D. Goodwill A/c

Q8 A company offered 2,00,000 shares for subscription to the public, but the applications were received (4 Marks)
for 1,90,000 shares only. The allotment will be confirmed to _________ shares.
A. 2,00,000
B. 1,90,000
C. 3,90,000
D. 10,000

Q9 When the full amount due in any call is not received the shortfall is debited to ___________. (4 Marks)
A. suspense A/c
B. calls in arrears A/c
C. shortfall A/c
D. accrued calls A/c

Q10 If the amount of minimum subscription is not received to the extent of _______, the issue disslove. (4 Marks)
A. 85%
B. 90%
C. 95%
D. 80%

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