Company Accounts (Shares & Debentures)

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Company Accounts (Shares & Debentures) — solved practice questions

8 Class 12 Accountancy questions with step-by-step solutions. Attempt each, then reveal the answer.

1. Q1medium

   As per Section 52 of the Companies Act 2013, the Securities Premium Reserve can be used for all of the following except:

   • AIssuing fully paid bonus shares
   • BWriting off preliminary expenses of the company
   • CPaying dividend to shareholders
   • DProviding for premium payable on redemption of debentures
   Show answer & solution

   Correct answer: (C) Paying dividend to shareholders

   Securities premium can be used for issuing bonus shares, writing off preliminary expenses, buy-back, and premium on redemption, but it cannot be used to pay dividends.

2. Q2easy

   As per SEBI guidelines, the minimum subscription that a company must receive on the issue of shares is:

   • A90% of the issued amount
   • B100% of the issued amount
   • C75% of the issued amount
   • D25% of the issued amount
   Show answer & solution

   Correct answer: (A) 90% of the issued amount

   SEBI guidelines require a company to receive at least 90% of the issued amount as minimum subscription; otherwise the application money must be refunded.

3. Q3easy

   As per Table F of the Companies Act 2013, the maximum rate of interest payable by a company on calls-in-advance is:

   • A5% per annum
   • B6% per annum
   • C10% per annum
   • D12% per annum
   Show answer & solution

   Correct answer: (D) 12% per annum

   Under Table F, a company may pay interest on calls-in-advance at a maximum rate of 12% per annum.

4. Q4easy

   As per Table F of the Companies Act 2013, the maximum rate of interest a company may charge on calls-in-arrears is:

   • A10% per annum
   • B12% per annum
   • C6% per annum
   • D5% per annum
   Show answer & solution

   Correct answer: (A) 10% per annum

   Under Table F, a company may charge interest on calls-in-arrears at a maximum rate of 10% per annum.

5. Q5medium

   A share of Rs 10 issued at par, on which only the application money of Rs 4 has been received, is forfeited for non-payment of allotment and call money. The amount credited to the Share Forfeiture Account is:

   • ARs 10 per share
   • BRs 6 per share
   • CRs 4 per share
   • DRs 3 per share
   Show answer & solution

   Correct answer: (C) Rs 4 per share

   Only the amount actually received on the share is credited to the Share Forfeiture Account; here that is the application money of Rs 4 per share.

6. Q6medium

   When forfeited shares are reissued at a discount, the amount of discount allowed on reissue cannot exceed:

   • AThe face value of the shares
   • BThe premium on the shares
   • CThe paid-up value of the shares
   • DThe amount received on the forfeited shares
   Show answer & solution

   Correct answer: (D) The amount received on the forfeited shares

   The discount on reissue is limited to the amount already forfeited (i.e., the amount received) on those shares; any excess forfeited amount is transferred to Capital Reserve.

7. Q7medium

   100 shares of Rs 10 each, on which Rs 600 had been received, were forfeited and later reissued as fully paid at Rs 8 per share. The amount transferred to Capital Reserve is:

   • ARs 200
   • BRs 400
   • CRs 600
   • DRs 800
   Show answer & solution

   Correct answer: (B) Rs 400

   Amount forfeited = Rs 600; discount on reissue = 100 x Rs 2 = Rs 200; Capital Reserve = 600 - 200 = Rs 400.

8. Q8easy

   In relation to a company, debenture holders are its:

   • AOwners
   • BDebtors
   • CCreditors
   • DPromoters
   Show answer & solution

   Correct answer: (C) Creditors

   A debenture is an acknowledgement of debt; debenture holders are creditors (lenders) of the company, not owners.

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