CBSE Questions for Class 12 Commerce Accountancy Accounting For Share Capital Quiz 4 - MCQExams.com

Balance of shares forfeiture account (before re-issue) is a:
  • Capital reserves
  • Revenue reserves
  • Share Capital
  • None of the above
30 shares of a company on which application money of Rs. 3 per share has been duly paid are forfeited for non payment of allotment money of Rs. 3 each and first and final call of Rs. 4 each. These shares are then re-issued at Rs.8 per share fully paid. How much money should be transferred to capital reserve?
  • Rs. 30
  • Rs. 60
  • Rs. 90
  • Rs. 120
Shares in Sharma Ltd. was acquired by Mr. B at a cost of Rs. 50,During the current p.y. he got right to acquire fresh shares. On the date of receiving the right entitlement intimation fair market value of existing shares held by Mr. B was Rs. 60,Mr. B sold the right paper for Rs. 75,His capital gains liability would be
  • Rs. 10,000
  • Rs. 15,000
  • Rs. 25,000
  • Rs. 75,000
When company issues shares to vendors of assets for a consideration other than cash such shares are issued:
  • At par
  • At a discount
  • At a premium
  • Any of the above
On a share of Rs. 10 on which Rs 8 has been called up but Rs. 5 has been paid forfeited. The share capital account should be debited by:
  • Rs. 5
  • Rs. 8
  • Rs. 10
  • None of the above
When shares are forfeited the share capital account is debited with the:
  • Nominal value of shares
  • Paid up value of shares
  • Called up value of share
  • None of the above
The balance of the share forfeiture account after the reissue of forfeited shares is transferred to __________________.
  • Capital redemption reserve account
  • Capital reserve account
  • General reserve account
  • Profit and loss account
In the above question assuming the forfeited shares were subsequently reissued as fully paid @ Rs.7 each. What is the entry for reissue of forfeited shares?
When the amount of 'Calls-in-advance' is received, the accounting entry will be made is:
  • Calls -in- advance A/c  Dr.
        To Relevant Call A/c
  • Calls -in- advance A/c  Dr.
        To Bank Call A/c
  • Bank A/c     Dr.
       To calls - in - advance A/c
  • None of the above
When shares are issued at discount, the amount of discount is debited to _______, which is in the nature of capital loss for the company.
  • Discount on issue of shares account
  • Securities discount account
  • Share forfeiture account
  • Securities premium account
In a share of Rs. 50, on which Rs.30 has been paid, is forfeited, it can be re-issued at the minimum price of ________________.
  • Rs.30 per share
  • Rs.20 per share
  • Rs.50 per share
  • Rs.40 per share
The Shekhawati Ltd. currently has sales of Rs. 30 Lakh with an average period of 2 months. At present,  no discount are offered to the  customers. The M. D. of the company is thinking to allow a discount of $$2\%$$ on cash sales which results in
(i) The average collection period would reduce to one month.
(ii) The company normally requires a $$25\%$$ return on its investment.
(iii) $$50\%$$ of customers would take advantage of $$2\%$$ discount.
In the above changed situation,the net  increase in profit of the company will be ___________.
  • Rs.30,000
  • Rs.62,500
  • Rs.32,500
  • Rs.72,500
X limited issued 10,000 equity shares of Rs.10 each at premium Rs.2 each. The company has incurred issue expenses of Rs.5,The equity shareholders expect dividend of $$18\%$$ then cost of capital is ____________.
  • $$18\%$$
  • $$15.65\%$$
  • $$16.65\%$$
  • $$18.65\%$$
Which of the following feature(s) of preference shares are similar to those of equity shares?
  • Redeemability
  • No obligation to pay dividend
  • Voting rights
  • Change over assets
  • Both (B) and (C) above
The balance of share forfeited account after the reissue of forfeited shares is transferred to ________________.
  • General Reserve Account
  • Capital Redemption Reserve Account
  • Capital Reserve
  • Revenue Reserve Account
Return of shares voluntarily by a shareholder to the company for cancellation is called _________________.
  • Forfeiture of shares
  • Transfer of shares
  • Redemption of shares
  • Surrender of shares
Securities Premium Account is shown on the liabilities side of the company's balance sheet under the heading ________.
  • Share Capital
  • Current Liabilities and Provisions
  • Unsecured Loans
  • Reserves and Surpluses
If the stock velocity is 6, cost of goods sold is Rs.54,000 and closing stock is Rs.10,000 the opening stock is __________.
  • Rs. 8,000
  • Rs. 9,000
  • Rs. 10,000
  • Rs. 12,000
  • Rs. 18,000
The _________ can either cancel or re-issue the forfeited shares.
  • Managers
  • Directors
  • Employees
  • Shareholders
The term equity share is defined in section ______ of the Company Act, $$2013$$.
  • $$2(18)$$
  • $$85(1)$$
  • $$43(i)$$
  • $$89(1)$$
Advantages of a corporate form of business organization includes _________.
  • limited liability
  • perpetual existence
  • no restriction on number of shareholders
  • all of the above
The capital of a company is divided into equal smaller units called __________.
  • units
  • shares
  • both (a) and (b)
  • none of the above
The term equity share means a share __________.
  • which is of equal denomination
  • which is not a preference share
  • which is so issued equally to all
  • which do not discriminate between the subscribers
State the following statements are True or False:
An individual can become a part of the company if the individual purchases the companies debt. 
  • True
  • False
Shares are movable property and transferable in the manner _________.
  • provided in the sales of goods act
  • provided in the article of associations
  • provided for transfer is immovable property
  • felt convenient by the transferor
The shares of a company are________. 
  • Transferable
  • Non-transferable
  • Fixed
  • None of the above
Owners of a company are ___________.
  • shareholders
  • board of directors
  • president of the company
  • debenture holders
Public company is a company which __________.
  • Is not a private limited company
  • Has a minimum paid up capital of $$Rs. 5,00,000$$ or such higher amount as may be prescribed
  • Is a private company, being a subsidiary of a company which is not a private company
  • all the above
Subscribed capital is ___________.
  • Part of issued capital subscribed by promoters
  • Part of issued capital subscribed by public only
  • Part of issued capital issued for consideration other than cash
  • Part of issued capital subscribed by public plus issued for consideration other than cash
A Public Company must be registered with a minimum share capital of _________.
  • $$Rs. 10\ lakhs$$
  • $$Rs. 5\ lakhs$$
  • $$Rs. 50\ lakhs$$
  • no limit
A Company formed and registered for future projects or to hold an asset or intellectual property rights can apply for registration as ___________.
  • dummy company
  • sham company
  • dormant company
  • inactive company
A Private Company must be registered with a minimum share capital of ___________.
  • $$Rs. 5\ lakhs$$
  • $$Rs. 1\ lakhs$$
  • $$Rs. 10\ lakhs$$
  • $$Rs. 50,000$$
The maximum number of members of a public company cannot exceed _________.
  • $$5000$$
  • $$1000$$
  • $$500$$
  • no limit
Share holders are entitled to ___________.
  • dividend
  • interest
  • remueration
  • commission
Which of these is one of the condition for issue of sweat equity shares by a company?
  • Authorized by a special resolution passed by the company in general meeting
  • Provision in the Article of Association of the company
  • Court orders authorizing such issue
  • Cannot be issued at discount
Equity shareholders are the __________.
  • Owner of the company
  • Creditors of the company
  • Debtor of the company
  • Management of the company
Which of the following statement is true?
  • Subscribed capital cannot exceed issued capital
  • Subscribed capital can exceed paid up capital
  • Issued capital can be less than called up capital
  • Paid up capital is always equal to authorized capital
Statutory corporations are created under ______________.
  • Companies act. $$1956$$
  • Statutory corporation act
  • An act enacted by the parliament
  • All the above
Which Amendment Act permits a company to issue equity share capital with differential rights as to dividend, voting or otherwise?
  • Companies (Amendment) act, $$2003$$
  • Companies (Amendment) act, $$2000$$
  • Companies (Amendment) act, $$1988$$
  • Companies (Amendment) act, $$2002$$
Which of these is an example of a Statutory Company?
  • RBI
  • LIC
  • SBI
  • All the three
The name of a private company ends with __________.
  • Limited
  • Public Ltd.
  • Private limited
  • Pvt.
Existing private/ closely held company with a three years track record of consistent profitability can issue shares at _________.
  • $$10$$% premium
  • at book building process
  • par only
  • free pricing either par or premium
The name of a public company should end with _________.
  • Limited
  • Pvt. Ltd.
  • Registered Ltd.
  • Ltd.
According to SEBI guideline a company must receive a minimum of _______% subscription before making any allotment of shares to the public.
  • $$75$$
  • $$90$$
  • $$50$$
  • $$25$$
Shares of a Pvt. Ltd. company are listed ___________.
  • In regional stock exchange
  • Not listed at all
  • In NSE
  • In BSE
Which of the following restriction is not applicable to a Private Ltd. Company?
  • To open overseas branch/ office
  • Restrict number of members to $$200$$
  • Invite application for public subsription
  • Invite application for public deposits
Which of these types of shares cannot be issued at discount?
  • New class of shares
  • Preference shares
  • Shares with differential dividend
  • all of the above
Minimum amount to be called up at the time of share application is ________.
  • $$5$$%
  • $$10$$%
  • $$15$$%
  • $$25$$%
A public company can issue share at a premium not more than __________.
  • $$10$$%
  • $$30$$%
  • no such limit prescribed
  • $$50$$%
When shares are allotted for consideration other than cash, the A/c to be debited would be ____________.
  • Goodwill A/c
  • Capital reserve A/c
  • Concerned assets A/c
  • Bonus share A/c
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