S.Y B.COM
SEMESTER - III
MID SEMESTER EXAMINATION
HIGHER FINANCIAL ACCOUNTING
(HFA)
OBJECTIVES
SHARE AND SHARE CAPITAL
(ISSUE, FORFEITURE AND RE-ISSUE OF SHARES)
TYPES OF SHARES
(1) A Company cannot issue -
(A) Redeemable Equity Shares
(B) Redeemable Debentures
(C) Redeemable Preference Shares
(D) Fully Convertible Debentures
(2) In Balance Sheet is not shown
(A) Authorised Capital
(B) Unissued Capital
(C) Subscribed Capital
(D) Paid-up Capital
(3) Consider the following statements:
Assertion (A): Rights Shares are given to equity Shareholders in proportion to their Share Capital in the Company.
Reason (R): Equity Shareholders assume the greatest risk in Company finance.
(A) Both A and R is true and R is the correct explanation for A
(B) Both A and R is true and R is not the correct explanation for A
(C) A is true but R is false
(D) A is false but R is true
(4) Right Shares are the Shares -
(A) Issued to the Directors of the Company
(B) First offered to the existing Shareholders
(C) First offered to the debenture holders
(D) Issued by a newly formed Company
(5) The balance appearing in the Books of a Company at the end of year were -
• Capital Redemption Reserve Alc - '50,000
• Security Premium - '5,000
• Revaluation Reserve - '20,000
• P&L A/c (Dr) -T 10,000.
Maximum amount available for distribution as Bonus Sares will be -
(A) Rs. 50,000
(B) Rs. 55,000
(C) Rs. 45,000
(D) Rs. 7, 57,000
SUBSCRIPTION TO SHARE CAPITAL
(6) The minimum subscription as prescribed by SEBI against the entire issue is-
(A) 95%
(B) 90%
(C) 5%
(D) None of these
(7) The number of Shares offered for subscription is more than the number of Shares subscribed by the public is known as -
(A) Full subscription
(B) Over subscription
(C) Under subscription
(D) Calls in arrear
(8) In case, the whole or a part of the Shares issued are not subscribed by the public who will subscribe such unsubscribed securities for a fixed commission?
(A) Brokers
(B) Underwriters
(C) Sales agents
(D) Commission agents
(9) Which of the following statement is not true with regard to issue of Shares by a Joint Stock Company?
(A) Shares can be issued for consideration other than cash
(B) In the event of over-subscription, the Company cannot allot more number of Shares than those specified in the prospectus.
(C) As per the SEBI guidelines, the minimum subscription clause is applicable only to the first issue of Share by the Company
(D) share application money is converted into Share Capital even before the Board of Directors approves the allotment of Shares.
(10) Which of the following statements is false?
(A) Shares can be issued for cash or any other consideration.
(B) In the event of over subscription, excess amount has to be refunded or a pro-rata allotment is to be made.
(C) SEBI guidelines are applicable not only for the first issue of Shares but also to subsequent issue of Shares.
(D) Share application money is automatically converted to Share Capital.
(11) If a Shareholder does not pay his dues on allotment, for the amount due there will be a -
(A) Share allotment A/c (Dr. balance)
(B) Share forfeiture A/c (Cr. balance)
(C) Share forfeiture Alc (Dr. balance)
(D) Share allotment A/c (Cr. balance)
(12) When Shares are allotted, the account to be credited will be?
(A) Share Capital Alc
(B) Share Application Alc
(C) Share AllotmentA/c
(D) Share First and Final call Alc
(13) When the money received on applications is to be adjusted at the time of allotment (partial allotment), then the account to be credited is-
(A) Share Capital Alc
(B) Share Allotment A/c
(C) Share Application Alc
(D) None of the above
PRO-RATA ALLOTMENT
(14) Pro-rata allotment is done in case of -
(A) Full subscription
(B) Over subscription
(C) Under subscription
(D) Shares issued at premium
(15) Pro-rata allotment of Shares means allotment of Shares-
(A) Equally amongst the applicants
(B) To all the applicants in proportion to the Shares applied for
(C) To only a few selected applicants
(D) At the discretion of the Directors
(16) A company issued 10,000 shares out of 14,000 applied. Mr. A got 300 shares on pro-rata basis. How many shares would he have applied for?
(A) 420 shares
(B) 300 shares
(C) 380 shares
(D) 500 shares
(17) A Company invited application for subscription of 5,000 Shares. Applications were received for 6,000 Shares. Shares were allotted pro-rata basis.
(i) If Shyam has applied for 180 Shares, how many Shares would be allotted to him?
(A) 180 Shares
(B) 200 Shares
(C) 150 Shares
(D) 175 Shares
(ii) If Shyam had been allotted 350 Shares, how many Shares he would have applied for?
(A) 300 Shares
(B) 400 Shares
(C) 420 Shares
(D) 425 Shares
(18) A Ltd. invites applications for subscription to 10,000 Shares, Rs. 2 to be paid on application. Applications were received for 18,000 Shares and Shares were allotted pro-rata basis to applicants of 15,000 Shares. If the excess application money is refunded, how much money will be refunded fo Ram who have been allotted 50 Shares?
(A) Rs. 80
(B) Rs. 50
(C) Rs. 42.50
(D) Rs. 30
(19) A Ltd had allotted 20,000 Shares to the applicants of 28,000 Shares on pro-rata basis. The amount payable on application is Rs. 2. M applied for 420 Shares. The number of Shares allotted and the amount carried forward for adjustment agaiinst allotment money due from Mr. X will be-
(A) 60 Shares, Rs. 120
(B) 340 Shares, Rs.160
(C) 320 Shares, Rs.200
(D) 300 Shares, Rs. 240
(20) A Company issued shares for 5,000 but applications are received for 7,500 shares. Mr. X applied for 600 shares. How many shares will he get & how much amount is transferred to allotment money, where application money is Rs. 3 per share?
(A) 400 Shares & Rs. 600
(B) 600 Shares & Rs. 600
(C) 500 Shares & Rs. 300
(D) None of the above
CALLS IN ARREARS
(21) Calls in Arrears Alc is shown as-
(A) Current Liabilites
(B) Deduction from Capital
(C) Addition to Capital
(D) Reserves in Surplus
(22) A Ltd Company issued equity Shares of '7 100 each. It has called up '75 on each Share but received only Rs.60 per Share. The Share Capital Alc will be credited with
(A) Rs.60 per Share
(B) Rs.75 per Share
(C) Rs.100 per Share
(D) Any of above
(23) Bittu Ltd issued 10,000 Shares of Rs. 10 each to public. Applications were received for 12,000 Shares by paying Rs.2 per Share. Shares were allotted on pro-rata basis to the public and excess money was kept to be used in allotment and further calls. Kittu failed to pay the money of Rs.3 per Share and her 1,000 Shares were forfeited after due notice. No further calls were made to her. Her call in arrears was
(A) Rs. 3,000
(B) Rs. 2,600
(C) Rs. 2,400
(D) Rs. 2,800
(24) On an equity Share of Rs. 20, the Company has called up T 18 but actually received 7 16 only, the Share Capital would be credited by
(A) Rs. 20
(B) Rs. 18
(C) Rs. 16
(D) Rs. 10
(25) The subscribed Share Capital of S Ltd is Rs.80,00,000 of Rs.100 each. There were no calls in arrear till the final call was made. The final call made was paid on 77,500 Shares. The calls in arrear amounted to T 62,500. The final call on Sharé will be
(A) Rs. 25
(B) Rs. 7.80
(C) Rs. 20
(D) Rs. 62.50
(26) Which of the following statement is true regarding calls-in-arreárs?
(A)Calls-in-arrears is that part of called up Capital which remain unpaid.
(B) It is not shown in the Balance Sheet until the defaulted Shares are forfeited.
(C) The rate of interest on calls in arrear is chargeable at 10% p.a., if a Company adopts Table A.
(D) Charging of interest on calis-in-arrear need not be permitted by the Articles of Association
(27) The Directors of a Company made the final call of Rs.30 per Share on June 15, 2014 indicating the last date of payment of call money to be June 30, 2014. Mr. X, holding 5,000 Shares paid the call money on Aug. 15, 2014.
According to Table A, the amount of interest @12% p.a on call-in-arrear to be paid by shareholder
(A) Rs.625.00
(B) Rs.937.50
(C) Rs.739.72
(D) Rs.1,125.00
(28) The subscribed Share Capital of S Ltd is 7 80,00,000 of 100 each. There were no calls-in-arrear til the final call was made. The final call made was paid on 77,500 Shares. The calls-in-arrear amounted to 75,000. The final call on per Share is
(A) Rs. 25
(B) Rs. 30
(C) Rs. 20
(D) Rs .15
CALLS IN ADVANCE
(29) The rate of interest paid on calls in advance as per Table A is
(A) 5% p.a.
(B) 6% p.a.
(C) 12%p.a.
(D) 4% p.a.
(30) Which of the following statements is false?
(A) Capital redemption reserve cannot be used for writing off miscellaneous expenses and losses.
(B) Capital profit realised in cash can be used for payment of dividend.
(C) Reserves created by revaluation of fixed assets are not permitted to be capitalised.
(D) Dividend is payable on the calls paid in advance by Shareholders
(31) When any Shareholders pay any call money in advance then the Alc to be credited would be-
(A) Calls in advance A/c
(B) Pre paid A/c
(C) Suspense Alc
(D) Goodwill A/c
(32) To receive calls in advance it should be
(A) Authorized by articles of associations
(B) Sanctioned by the Central Government
(C) Authorized by special resolution
(D) All the above
(33) The interest on calls-in-advance is paid for the period from the
(A) Date of receipt of application money to the date of appropriation
(B) Date of receipt of allotment money to the date of appropriation
(C) Date of receipt of advance to the date of appropriation
(D) Date of appropriation to the date of dividend payment
(34) Which of the following statements is false?
(A) Interest on calls-in-advance is paid from the date of receipt of advance to the date of relevant call.
(B) Interest on calls-in-advance is paid at declared rate in the prospectus
(C) Interest on calls-in-advance is paid at the rate of 12% p.a.
(D) Payment of interest on calls-in-advance is at the discretion of the Company.
PREMIUM ON ISSUE OF SHARES
(35) The amount called over and above the nominal value of Share should be credited to:
(A) Share premium A/c
(B) Share Capital A/c
(C) Share allotment A/c
(D) None of the above
(36) Premium received on the issue of Shares is shown in
(A) Debit side of Profit and Loss Account
(B) Asses side of the Balance Sheet
(C) Credit side of Profit and Loss Account
(D) Liabilities side of the Balance Sheet
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