MCQ. Total amount of liabilities side includes the following :- A. Aut...
Total amount of liabilities side includes the following:
A. Authorized Capital
B. Issued Capital
C. Subscribed Capital
D. Paid-Up Capital
1. Authorized Capital:
Authorized capital refers to the maximum amount of capital that a company is legally allowed to raise by issuing shares. It is the upper limit set by the company's articles of association. This capital is not necessarily issued or subscribed by the shareholders.
2. Issued Capital:
Issued capital is the actual amount of authorized capital that a company has offered to the public or shareholders for subscription. It represents the value of shares that have been issued and allotted to shareholders. This capital can be in the form of common shares or preferred shares.
3. Subscribed Capital:
Subscribed capital refers to the portion of the issued capital that has been subscribed or agreed to be taken up by the shareholders. It represents the amount of capital that shareholders have committed to contributing to the company. The subscribed capital may be less than or equal to the issued capital depending on the level of interest and subscription from the shareholders.
4. Paid-Up Capital:
Paid-up capital is the amount of capital that has been fully paid by the shareholders to the company. It represents the actual cash or assets contributed by the shareholders in exchange for the shares they have subscribed to. The paid-up capital can be lower than the subscribed capital if the shareholders have not fully paid their subscription amount.
In summary, the total amount of liabilities side includes the authorized capital, which is the maximum capital a company can raise, the issued capital, which is the actual amount offered to the public or shareholders, the subscribed capital, which is the portion of the issued capital subscribed by shareholders, and the paid-up capital, which is the amount fully paid by shareholders. These different components of the liabilities side provide insight into the financial structure and capitalization of a company.
MCQ. Total amount of liabilities side includes the following :- A. Aut...
D. Paid-up Capital
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