Corporate Accounting Quizz

What is under-subscription of shares?

• When applications received are less than shares offered

• When applications received are more than shares offered

• When shares are issued at a discount

• When shares are issued at a premium

What is pro-rata allotment?

• Allotting shares equally to all applicants

• Allotting shares proportionately to applicants

• Allotting shares only to large investors

• Allotting shares at a discount

What are "calls in arrears"?

• Amount received in advance from shareholders

• Amount not paid by shareholders on due date

• Amount paid by shareholders in excess

• Amount forfeited by the company

What is "forfeiture of shares"?

• Cancellation of shares due to non-payment of calls

• Reissue of shares at a premium

• Redemption of shares

• Transfer of shares to another party

What is the purpose of reissuing forfeited shares?

• To recover the unpaid amount

• To increase the share capital

• To reduce the share capital

• To issue shares at a discount

What is the source of funds for redemption of preference shares out of profits?

• Fresh issue of shares

• Retained earnings

• Debentures

• Bank loans

What is the method of redemption of debentures by purchase?

• Buying back debentures from the open market

• Issuing new debentures

• Converting debentures into shares

• Forfeiting debentures

What is the primary purpose of preparing a Balance Sheet?

• To show the financial position of the company

• To calculate profit or loss

• To determine tax liability

• To record daily transactions

Which of the following is a compulsory transfer to reserves?

• General Reserve

• Dividend Equalization Reserve

• Capital Reserve

• Specific Reserve

What is the new format of the Profit & Loss Account as per the Companies Act?

• Vertical format

• Horizontal format

• Tabular format

• Circular format