Money received in advance from shareholders before it is actually called-up by the directors is :
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Credited to calls in advance account
Money a shareholder pays before the call is made is not yet due, so the company owes it back until the call is made. It is credited to Calls in Advance Account (Bank A/c is debited) and is shown as a current liability until it is adjusted against the call.
NCERT (2026-27 edition):
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