Accountancy Part AAccounting for Shares

In what condition the amount is shown under the head of 'Subscribed a…

In what condition the amount is shown under the head of 'Subscribed and Fully Paid up Share Capital' in Balance Sheet of a Company?

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → If shares are fully called up and there are no Calls in Arrears

Subscribed capital is shown in two parts: subscribed and fully paid up, and subscribed but not fully paid up. A share is fully paid when the whole face value has been called up and received. That needs two things: the shares are fully called up, and nothing is left unpaid on the calls.

Option (1) If shares are fully called up and there are Calls in Arrears — Incorrect. With calls in arrears the called amount is not fully received, so the shares are not fully paid up.

Option (3) If shares are partly called up and there are no Calls in Arrears — Incorrect. Partly called-up shares are subscribed but not fully paid up, even if every call made is paid.

Option (4) If shares are partly called up and there are Calls in Arrears — Incorrect. Both conditions fail.

NCERT (2026-27 edition):
Categories of Share Capital – “… Paid up Capital: It is that portion of the called up capital which has been actually received from the shareholders. When the shareholders have paid all the called amount, the called up capital is the same to the paid up capital. If any of the shareholders has not paid amount on calls, such an amount may be called as ‘calls in arrears’. Therefore, paid up capital is equal to the called-up capital minus call in arrears.”