CUET Preparation Today
Reserve capital is...... |
A kind of capital reserve Part of called up capital Part of the subscribed capital decided not to be called up except in the event of winding up Part of capital not yet issued |
Part of the subscribed capital decided not to be called up except in the event of winding up |
The correct answer is option 3- Part of the subscribed capital decided not to be called up except in the event of winding up. Reserve capital is a part of the subscribed capital decided not to be called up except in the event of winding up. 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. |
