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XYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity shares to a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.
Q. The following refer to the maximum amount of share capitals issued by a company in its life times except:
- a)Subscribed Capital
- b)Authorised Capital
- c)Nominal Capital
- d)Registered Capital
Correct answer is option 'A'. Can you explain this answer?
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Most Upvoted Answer
PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh...
Explanation:
The maximum amount of share capital issued by a company in its lifetime refers to the total value of shares that the company is authorized to issue. It is important to understand the different types of share capital in order to answer this question correctly.
Types of Share Capital:
1. Authorized Capital: This is the maximum amount of share capital that a company is authorized to issue. It is mentioned in the company's Memorandum of Association (MoA) and can only be changed by following the legal procedures.
2. Subscribed Capital: This refers to the portion of the authorized capital that has been subscribed or taken up by the shareholders. It represents the actual amount of share capital that has been issued by the company.
3. Nominal Capital: This is the face value of the shares that a company issues. It is determined at the time of incorporation and is mentioned in the company's MoA.
4. Registered Capital: This refers to the portion of the authorized capital that has been registered with the Registrar of Companies. It represents the amount of share capital that the company is legally allowed to issue.
Answer:
The maximum amount of share capital issued by a company in its lifetime is represented by the Authorized Capital. This is the total value of shares that the company is authorized to issue, as mentioned in its Memorandum of Association (MoA). In the case of PassageXYZ Ltd, the authorized capital is Rs. 20 lakh, divided into 2 lakh equity shares of Rs. 10 each.
The company decided to issue 1 lakh equity shares of Rs. 10 each to diversify its operations. Out of these, 20,000 equity shares were issued to a vendor in exchange for machinery, and the rest were meant to be issued to the general public. However, the company received applications for only 46,000 equity shares, which led to an undersubscription. As a result, the shares were not issued to the public.
In conclusion, while authorized capital represents the maximum amount of share capital that a company can issue, subscribed capital refers to the actual amount of share capital that has been issued. The other options mentioned in the question (nominal capital and registered capital) are not relevant in determining the maximum amount of share capital issued by a company in its lifetime.
The maximum amount of share capital issued by a company in its lifetime refers to the total value of shares that the company is authorized to issue. It is important to understand the different types of share capital in order to answer this question correctly.
Types of Share Capital:
1. Authorized Capital: This is the maximum amount of share capital that a company is authorized to issue. It is mentioned in the company's Memorandum of Association (MoA) and can only be changed by following the legal procedures.
2. Subscribed Capital: This refers to the portion of the authorized capital that has been subscribed or taken up by the shareholders. It represents the actual amount of share capital that has been issued by the company.
3. Nominal Capital: This is the face value of the shares that a company issues. It is determined at the time of incorporation and is mentioned in the company's MoA.
4. Registered Capital: This refers to the portion of the authorized capital that has been registered with the Registrar of Companies. It represents the amount of share capital that the company is legally allowed to issue.
Answer:
The maximum amount of share capital issued by a company in its lifetime is represented by the Authorized Capital. This is the total value of shares that the company is authorized to issue, as mentioned in its Memorandum of Association (MoA). In the case of PassageXYZ Ltd, the authorized capital is Rs. 20 lakh, divided into 2 lakh equity shares of Rs. 10 each.
The company decided to issue 1 lakh equity shares of Rs. 10 each to diversify its operations. Out of these, 20,000 equity shares were issued to a vendor in exchange for machinery, and the rest were meant to be issued to the general public. However, the company received applications for only 46,000 equity shares, which led to an undersubscription. As a result, the shares were not issued to the public.
In conclusion, while authorized capital represents the maximum amount of share capital that a company can issue, subscribed capital refers to the actual amount of share capital that has been issued. The other options mentioned in the question (nominal capital and registered capital) are not relevant in determining the maximum amount of share capital issued by a company in its lifetime.
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Community Answer
PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh...
Subscribed capital is not the maximum amount of share capitals
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PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer?
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PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer? for Humanities/Arts 2024 is part of Humanities/Arts preparation. The Question and answers have been prepared according to the Humanities/Arts exam syllabus. Information about PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Humanities/Arts 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer?.
PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer? for Humanities/Arts 2024 is part of Humanities/Arts preparation. The Question and answers have been prepared according to the Humanities/Arts exam syllabus. Information about PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Humanities/Arts 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for PassageXYZ Ltd is registered with an authorised capital of Rs. 20 lakh divided into 2 lakh equity shares of Rs. 10 each. The company is in manufacturing of pickles and spices. Due to the increase in demand of packed food in the market they decided to diversity its operation. For this purpose they decided to issue 1 lakh equity share of Rs. 10 each. The company issue 20,000 equity sharesto a vendor to supply the machinery required to manufacture the packed food. Rest of the equity shares were issued to general public for subscription. The application were received for 46,000 equity shares, Due to undersubscription of equity shares the shares were not issued to public.Q.The following refer to the maximum amount of share capitals issued by a company in its life times except:a)Subscribed Capitalb)Authorised Capitalc)Nominal Capitald)Registered CapitalCorrect answer is option 'A'. Can you explain this answer?.
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