Match List – I with List – II.

Choose the correct answer from the options given below :

A-IV, B-II, C-III, D-I

The correct answer is Option (1) - A-IV, B-II, C-III, D-I.

* Reserve Capital of a company- Not shown in Balance Sheet. A company may set aside a portion of its uncalled capital, which would only be called upon in the event of the company's liquidation or winding up. This uncalled amount is referred to as the company's 'Reserve Capital' and is exclusively reserved for the satisfaction of creditors during the liquidation process. It is not shown in the balance sheet of the company.

* Capital Reserve of a company- Created out of capital Gain. Capital reserves are usually created from profits that are not distributable as dividends. These reserves may come from sources other than revenue profits, such as the sale of assets or revaluation of assets.

* Subscribed Capital of a company- Allotted Capital. Subscribed capital is that part of the issued capital which has been actually subscribed by the public. When the shares offered for public subscription are subscribed fully by the public the issued capital and subscribed capital would be the same. It may be noted that ultimately, the subscribed capital may be equal to or less than issued capital. In case the number of shares subscribed is less than what is offered, the company allots only the number of shares for which subscription has been received. In case it is higher than what is offered, the allotment will be equal to the offer. In other words, the fact of over subscription is not reflected in the books.

* Nominal Capital of a Company- Memorandum of Association. Nominal capital is another name for the authorised capital. Authorised capital is the amount of share capital which a company is authorised to issue by its Memorandum of Association. The company cannot raise more than the amount of capital as specified in the Memorandum of Association. It is also called Nominal or Registered capital. The authorised capital can be increased or decreased as per the procedure laid down in the Companies Act. It should be noted that the company need not issue the entire authorised capital for public subscription at a time. Depending upon its requirement, it may issue share capital but in any case, it should not be more than the amount of authorised capital.