Match the following-
| LIST 1 | LIST 2 |
| (A) Application Money should be at least | (I) 25% of face value |
| (B) The interest rate on calls in Arrears | (II) 12% p.a |
| (C) The interest rate on calls in Advance | (III) 10% p.a. |
| (D) The amount of calls should not exceed | (IV) 5% of face value |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is option 4- (A)-(IV), (B)-(III), (C)-(II), (D)-(I).
| LIST 1 | LIST 2 |
| (A) Application Money should be at least | (IV) 5% of face value |
| (B) The interest rate on calls in Arrears | (III) 10% p.a. |
| (C) The interest rate on calls in Advance | (II) 12% p.a |
| (D) The amount of calls should not exceed | (I) 25% of face value |
* Application Money should be at least- Application money should be at least 5% of the face value of the share. For e.g. if a share having face value of ₹100 is issued then minimum ₹5 must be collected by the company on application.
* The interest rate on calls in Arrears and The interest rate on calls in Advance- As per Companies Act, 2013, the maximum rate of interest on calls in advance is 12%p.a. As per Companies Act, 2013, the maximum rate of interest on calls in arrears is 10% p.a.
* The amount of calls should not exceed - Calls are essential in the process of making shares fully paid-up and collecting the total share amount from shareholders. Once shares are allotted, a company initiates calls. Two critical points concerning calls on shares are noteworthy. First, any call amount should not exceed 25% of the shares' face value. Second, there must be a minimum one-month interval between the issuance of two calls, unless the company's articles of association specify otherwise.