Arrange following in correct sequence related to issue of shares. (A)…

Arrange following in correct sequence related to issue of shares.

(A) Letters of allotment, and letters of regret are sent

(B) Prospective investors would make an application along with the application money

(D) Sebsequent installment are called

Choose the correct answer from the options given below:

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → (C), (B), (A), (D)

The steps of a share issue, in order:

(C) The company issues the prospectus to the public — the invitation to subscribe.

(B) Prospective investors would make an application along with the application money — the response to the prospectus.

(A) Letters of allotment, and letters of regret are sent — allotment, once minimum subscription is received.

(D) Subsequent installment are called — calls on the allotted shares.

NCERT (2026-27 edition):
Issue of Shares – “… The important steps in the procedure of share issue are : • Issue of Prospectus: The company first issues the prospectus to the public. Prospectus is an invitation to the public that a new company has come into existence and it needs funds for doing business.”

NCERT (2026-27 edition):
Issue of Shares – “… • Receipt of Applications: When prospectus is issued to the public, prospective investors intending to subscribe the share capital of the company would make an application along with the application money and deposit the same with a scheduled bank as specified in the prospectus.”

NCERT (2026-27 edition):
Allotment of Shares – “… If minimum subscription has been received, the company may proceed for the allotment of shares after fulfilling certain other legal formalities. Letters of allotment are sent to those whom the shares have been alloted, and letters of regret to those to whom no allotment has been made.”

NCERT (2026-27 edition):
Accounting Treatment – “… On Calls : Calls play a vital role in making shares fully paid-up and for realising the full amount of shares from the shareholders.”