Practicing Success
Answer based on following passage. Earn Limited, with an authorised capital of 10,00,000 is divided into equity shares of ₹ 10 each, issued 50,000 equity shares at a premium of 3 per share payable as follows. On application - 3 per share Applications were received for 60,000 shares. The Directors allotted the shares to all applicants on pro-rata basis. All money received except I call on 1,000 shares issued to Ravi. |
Identify the term that represent authorised capital which is not offered for public subscription. |
Uncalled Capital Reserve Capital Unissued Capital Calls not made |
Unissued Capital |
The correct answer is Option (3) → Unissued Capital Unissued capital denotes the segment of authorized capital that has not been distributed to the public or shareholders. This pool of capital remains untapped and can be utilized in the future as required. It is distinct from the capital initially made available for subscription, as it is not offered to the public from the outset. |