Accounting for share Capital Test

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Accounting for share Capital Test - 22

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Weekly Quiz Competition

Question 1
1 / -0

If the company has adopted Table A as the articles, the interest charged on calls-in-arrears will be _______________.

A
$$5$$% per annum

B
$$7$$% per annum

C
$$9$$% per annum

D
$$10$$% per annum

Solution

According to Table A :-
Default rate of interest to be levied on call- in- arrears
5% p.a Now Company can charge 10% interest on call-in-arrear
Question 2
1 / -0

Statement $$1$$: Discount on issue of shares should be shown on the asset side of the balance sheet.
Statement $$2$$: The discount has to be written off even through profit and loss account
Choose the correct.

A
Both the statements $$1$$ and $$2$$ are correct

B
Statement $$1$$ is correct but statement $$2$$ is false

C
Statement $$1$$ is false but statement $$2$$ is correct

D
Both the statement $$1$$ and $$2$$ are false

Solution

In the balance sheet, 'Discount on Issue of Shares Account' appears on the “Assets” side under the heading 'Miscellaneous Expenditure'.
Since debentures are for five years, every year fifth of the discount can be taken to profit and loss account.
In the ratio of amount used. Since in this case the plan of redemption is given it is possible to write off discount in the ratio of amount used.
Question 3
1 / -0

Valuation is related to _______________.

A
Past

B
Future

C
Present

D
Both (A) and (B)
Question 4
1 / -0

The value of shares of a company as affected by ______________.

A
Economic factors

B
Political factors

C
Social factors

D
All the above

Solution

The value of a share is greatly affected by the economic, political and social factors such as:
(i) The nature of the company’s business;
(ii) The economic conditions of the country;
(iii) Other political and economic factors (e.g., possibility of nationalization, excise duty on goods produced, etc.);
(iv) The demand and supply of shares;
(v) Proportion of liabilities and capital;
(vi) Rate of proposed dividend and past profit of the company;
(vii) Yield of other related shares of the Stock Exchange.
Question 5
1 / -0

When an existing company takes over the business 'of one or more existing companies, it is __________.

A
Absorption

B
Amalgamation

C
Reconstruction

D
Both (A) and (B)
Question 6
1 / -0

Which section(s) of the company act specify the provisions relating to amalgamation?

A
$$360$$ and $$362$$

B
$$340$$

C
$$320$$ and $$326$$

D
$$390$$ and $$396(a)$$

Solution

According to section 390 and 396(a) of the Indian companies act, 2013, amalgamation is defined as a situation in which two or more companies come together to form a new company.
Question 7
1 / -0

The term contributory includes __________.

A
the holder of fully paid shares

B
the holder of partly paid shares

C
a past member who has ceased to be a member

D
the holder of unpaid capital

Solution

The members of the company on the commencement of the business is known as contributory. As per section 428 of the companies act, 2013, every person who is liable yo contribute to the assets of the company at the time of its winding up or holder of a fully paid share is called as contributory.
Question 8
1 / -0

Liquidator's Fees must be paid to the ____________________.

A
Central Government

B
State Government

C
Court

D
Promoter
Question 9
1 / -0

The company which is amalgamated into another company is called as ________.

A
Transferor of company

B
Transferee company

C
Holding company

D
None of the Above

Solution

A company which makes transfer of assets to another company is called a transferor company. A transferor can make the transfer willingly or forcefully in case of legal circumstances. Hence, a company which is amalgamated into another company is called as transferor company.
Question 10
1 / -0

When a company takes over another one and clearly becomes a new owner, the action is called_________.

A
Merger

B
Acquisition

C
Strategic Alliance

D
None of the above

Solution

The terms "mergers" and "acquisitions" are often used interchangeably, although in actuality, they hold slightly different meanings. When one company takes over another entity, and establishes itself as the new owner, the purchase is called an acquisition.

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Re-Attempt Weekly Quiz Competition

Accounting for share Capital Test - 22

Result

Accounting for share Capital Test - 22

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Rank

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SHARING IS CARING

Question 1

$$5$$% per annum

$$7$$% per annum

$$9$$% per annum

$$10$$% per annum

Solution

Question 2

Both the statements $$1$$ and $$2$$ are correct

Statement $$1$$ is correct but statement $$2$$ is false

Statement $$1$$ is false but statement $$2$$ is correct

Both the statement $$1$$ and $$2$$ are false

Solution

Question 3

Past

Future

Present

Both (A) and (B)

Question 4

Economic factors

Political factors

Social factors

All the above

Solution

Question 5

Absorption

Amalgamation

Reconstruction

Both (A) and (B)

Question 6

$$360$$ and $$362$$

$$340$$

$$320$$ and $$326$$

$$390$$ and $$396(a)$$

Solution

Question 7

the holder of fully paid shares

the holder of partly paid shares

a past member who has ceased to be a member

the holder of unpaid capital

Solution

Question 8

Central Government

State Government

Court

Promoter

Question 9

Transferor of company

Transferee company

Holding company

None of the Above

Solution

Question 10

Merger

Acquisition

Strategic Alliance

None of the above

Solution

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