Which of the following statements about share capital is TRUE?
(A) A company's shares are generally transferable.
(B) Share application account is a personal account.
(C) The part of capital which is called up only on winding up of a company is called reserve capital.
(D) Paid up capital can exceed called up capital.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (B) and (C) only
(A) A company’s shares are generally transferable. True. Shares of a company can be transferred freely, subject to the articles.
(B) Share application account is a personal account. True. It records what is due to or from the applicants, who are persons.
(C) The part of capital which is called up only on winding up of a company is called reserve capital. True. That uncalled portion is kept for the creditors at winding up.
(D) Paid up capital can exceed called up capital. False. Paid-up capital is the part of called-up capital actually received, so it is at most equal to called-up capital; money paid before a call is kept apart as calls in advance.
NCERT (2026-27 edition):
NCERT (2026-27 edition):
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