Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Shares

Question:

A Ltd has 10,00000 authorised share capital. They issued 5,000 shares of Rs 100 each. Applications were received for 4500 shares. Company accepted these applications and allotted shares to them. How much amount will be shown in the companies Balance Sheet as paid up Share Capital?

Options:

₹10,00,000

₹5,00,000

₹4,50,000

None of these

Correct Answer:

₹4,50,000

Explanation:

The paid-up share capital is the portion of the authorized share capital for which the company has received payment from the shareholders.
In this case, 4500 shares were applied for and allotted.
Number of shares issued = 5000
Face value per share = Rs 100
Applications received = 4500
Amount shown in the company's Balance Sheet as paid-up Share Capital = Number of shares allotted * Face value per share
  = 4500 * Rs 100 = ₹4,50,000