MCQ Chapter 1 Accounting for Share Capital Class 12 Accountancy

Please refer to Accounting for Share Capital MCQ Questions Class 12 Accountancy below. These MCQ questions for Class 12 Accountancy with answers have been designed as per the latest NCERT, CBSE books and syllabus issued for the current academic year. These objective questions for Accounting for Share Capital will help you to prepare for the exams and get more marks.

Accounting for Share Capital MCQ Questions Class 12 Accountancy

Please see solved MCQ Questions for Accounting for Share Capital in Class 12 Accountancy. All questions and answers have been prepared by expert faculty of standard 12 based on latest examination guidelines.

MCQ Questions Class 12 Accountancy Accounting for Share Capital

Question. As per sec. of the companies Act amount. received as premium on securities cannot be utilized for :-
(a) Issuing fully paid bonus shares to the members
(b) Purchase of fixed assets
(c) Writing off preliminary expenses
(d) Buy back of its own shares

Question. Preference shares can be of following types :-
(a) Cumulative Preference shares
(b) Participating Preference shares
(c) Redeemable Preference shares
(d) All of the above 

Question. The amount of capital that a company can issue as par value is called:-
(a) Authorised capital
(b) Share premium
(c) Issued capital
(d) Fixed capital 

Question. When the shares are issued for consideration other than cash which account will be debited
(a) Securities Premium
(b) Capital Reserve A/c
(c) Vendor A/c
(d) Share Capital A/c

Question. Penalty for delay in refunding application money is charged:-
(a) 6%
(b) 5%
(c) 15%
(d) 20%

Question. The portion of authorized capital which can be called up only on the liquidation of the company :-
(a) Authorised capital
(b) Reserve capital
(c) Issued capital
(d) Called up capital

Question. Which of the following capital is not shown in the company’s Balance Sheet
(a) Authorised capital
(b) `Issued &subscribed capital
(c) Called-up & paid up-capital
(d) Reserve capital

Question. Shares Application &Allotment A/c is a:-
(a) Personal
(b) Real
(c) Nominal 

Question. ltd company took over assets worth Rs. 10,00,000 and liabilities of Rs. 3,00,000for a purchase consideration of Rs. 12,00,000 Rs. 2,00,000 bill payable accepted and remaining was paid by issuing shares at a premium of 25% on face value Rs. 100. How much amount will be credited to Securities Premium A/c
(a) Rs. 8,00,000
(b) Rs. 2,00,000
(c) Rs. 10,00,000
(d) Rs. 12,00,00

Question.Company allotted 20,000 shares to applicants of 50,000 shares after rejecting 10,000 applications. The ratio in which company allotted the share will be
(a) 5:2
(b) 5:3
(c) 2:1
(d) 3:1

Question. Co. has issued 6,000 equity shares of. Rs. 10 each at par and called up amount Rs. 6 per share. The remaining part of capital is termed as
(a) Called up Capital
(b) Paid up Capital
(c) uncalled Capital
(d) Subscribed Capital

Question. A company has issued 6,000 equity share of Rs. 10 each at par on application Rs. 2, Rs. 3 on allotment Rs. 2 on first call Rs. 2 on second call and remaining final call. The second call was not made
The amount collected on allotment is …………..
(a) 17000
(b) 19000
(c) 15000
(d) 18000

Question. A company issued 6,000 shares of Rs. 10 each money to be called up:-On application Rs. 3 on allotment Rs. 3 on first call Rs. 2 and remaining on second call. On allotment one shareholders having 100 shares paid full amount
The amount collected on allotment……….
(a) 18,000
(b) 12,000
(c) 18,400
(d) 18,600

Question.  ltd. Forfeited 1,000 shares of Rs. 10 each for the non-payment of final call of Rs. 2. The account will be debited for called up price of a share at the time of forfeiture of shares :
(a) Share Forfeiture A/c
(b) Share Capital A/c
(c) Share Final Call A/c
(d) None of these

Question. If the purchase consideration is more than net worth then which account will be debited for the difference amount
(a) Capital Reserve A/c
(b) Asset A/c
(c) Goodwill A/c
(d) Vendor A/c

Question. Amount of discount given at the time of reissue of shares should be debited to :
(a) Shares Capital
(b) Discount on Shares
(c) Share Forfeiture A/c
(d) Calls-In-Areas A/c

Question. ltd company took over assets worth Rs. 10,00,000 and liabilities of Rs. 3,00,000 for purchase consideration worth Rs. 12,00,000 how much amount will be debited to goodwill account
(a) Rs. 10,00,000
(b) Rs. 5,00,000
(c) Rs. 3,00,000
(d) Rs. 12,00,000

Question. A company issued 10,000 shares of Rs 10 each at par ; Rs3 on application ; Rs 3 on allotment ; Rs4 on First & Final call . One shareholder holding 1,000 shares paid the entire amount of his shares with application . Calculate amount received on application :
a) 1,00,000
b) 1,17,000
c) 1,10,000
d) 37,000 

Question. A company Forfeited 1,000 shares of Rs10 each , Rs7 called up . For the non payment of Rs 2 First call. All these shares were reissued at Rs 5 per share . What amount will be debited to share Forfeiture account :
a) 5,000
b) 2,000
c) 7,000
d) 10,000

Question. A company Forfeited 1,000 shares of Rs 10 each , Rs 7 called up . For the non payment of Rs 2 First call .All these shares were reissued at Rs 5 per share . What will be Amount credited to share capital account at reissue:
a) 7,000
b) 10,000
c) 5,000
d) 2,000

Question. A company Forfeited 1,000 shares of Rs 10 each , Rs 7 called up. For the non payment of Rs 2 First call . All these shares were reissued at Rs 5 per share. What will the amount transferred to capital Reserve account :
a) 2,000
b) 3,000
c) 4,000
d) 5,000

Question. A company Forfeited 2,000 shares of Rs 10 each issued at 20 % premium to be paid at the time of allotment on which Rs 8 is called up. company not received Rs 4 on Allotment including premium and Rs2 in First call. What will be the amount Debited to share capital account:
a) 20,000
b) 16,000
c) 24,000

Question.2,000 shares of Rs. 10 on which 7 have been called and Rs. 5 has been paid are forfeiture out of these 1,500 shares is reissued for Rs. 9 as fully paid. What is the amount to be debited to Share forfeiture A/c at the time of reissue of shares
(a) Rs. 13,500
(b) Rs. 1,500
(c) Rs. 15,000
(d) Rs. 14,000

Question.If the Purchase consideration is less than net worth then which account will be debited for the difference amount :
a) Capital Reserve
b) Assets
c) Goodwill
d) Vendor 

Question.A company Forfeited 2,000 shares of Rs10 each issued at 20 % premium to be paid at the time of allotment on which Rs 8 is called up. Company not received Rs 4 on allotment including premium and Rs2 on First call .What will be the amount credited to share Forfeiture account :
a) 10,000
b) 8,000
c) 6,000
d) 2,000 

Question. Amount of money not received out of called up capital is :
(A.) Added to share capital
(B.) Subtracted from share capital
(C.) Shown as current liabilities
(D.) Shown as current asset

Question. A company issued 4,000 equity shares of rupees 10 each at par payable as under:
On application rupees 3 , on allotment rupees 2; on first call rupees 4 and on final call rupees 1 per share. Applicants were received for 16,000 share . Application for 6,000 shares were rejected and pro-rata allotment was made to the applicants for 10,000 shares . How much amount will be received in cash on first call,when excess application money is adjusted towards amount due on allotments and calls :
(A.) Rupees 6.000
(B.) nil
(C.) Rupees 16,000
(D.) Rupees 10,000

Question. Rajan Limited issued 50,000 shares at a price lower than the nominal value of the share. The shares issued are called:
A) Sweat equity shares
B) Redeemable Preference shares
C) Equity shares
D) Bonus shares

Question. Arrange the following in proper sequence as types of “Share Capital”
(A) Paid up capital
(B) Issued capital
(C) Subscribed capital
(D) Called up capital   

Question. A company issued 4000 equity shares of rupees 50 each at par payable as under:
On application rupees 20%, on allotment 40% ; on first call 10% ; on final call -balance
Applications were received for 10,000 shares . Allotment was made pro-rata . How much amount will be received in cash on allotment?
A) Rupees 6.000
(B.) nil
(C.) Rupees 16,000
(D.) Rupees 20,000

Question. Which one of the following is not a part of subscribed capital:
A) Equity shares issued to vendor
B) Preference shares of convertible type
C) Forfeited shares
D) Bonus shares

Question. Maximum limit of premium on shares is :
(A.) 32%
(B.) 20%
(C.) No limit
(D.) 100%

Question. E Ltd. had allotted 10,000 shares to the applicants of 14,000 shares on pro-rata basis, application money on another 6000 shares was refunded .The amount payable on the application was Rs.2. Sitaraman applied for 420 shares . The number of shares allotted to him will be:
(A.) 60 shares
(B.) 340 shares
(C.) 320 shares
(D.) 300 shares

Question. Zen Ltd purchased the sundry assets of M/s Surat Industries for Rs.28,60,000 payable in fully paid shares of Rs.100 each. State the number of shares issued to vendor when issued at premium of 10%.
A)28,000
B)31,778
C)28,600
D)26,000

Question. Following amounts were payable on issue of shares by a company : Rs.3 on application , Rs.3 on allotment , Rs.2 on first call and Rs.2 on final call . X holding 500 shares paid only application and allotment money whereas Y holding 400 shares did not pay final call . Amount of calls in arrear will be:
(A.) 3,800
(B.) 2,800
(C.) 1,800
(D.) 6,200

Question. The subscribed share capital of Mukand Ltd is Rs.1,00,00,000 of Rs.100 each. There were no calls in arrear till the final call was made. The final call made was paid on 97,500 shares. The calls in arrear amounted to Rs.87,500.The final call on share :
A)Rs.20
B)Rs.35
C)Rs.25
D)Rs.45

Question. Daisy Limited forfeited 200 shares Rs.10 each who had applied for 500 shares, issued at a premium of 10% for nonpayment of final call of Rs.3 per share. Out of these 100 shares were issued as fully paid up for Rs.15. The profit on reissue is :
A ) Rs. 700
B) Rs. 6400
C) Rs. 300
D) Rs. 400

Question. These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity share holders are called:
A) Participating preference shares
B) Convertible preference shares
C) Redeemable preference shares
D) Cumulative preference shares

Question. T Ltd had allotted 20,000 shares to the applicants of 24,000 shares on pro rata basis. The amount payable on application is Rs.2. Manoranjan applied for 450 shares. The number of shares allotted and the amount carried forward for adjustment against allotment money due from him is:
A) 150 shares,Rs.375
B) 375 shares,Rs.150
C) 400 shares,Rs.100
D) 300 shares,Rs.300

Question. Zee Ltd issued 15,000 equity shares of Rs.20 each at a premium of Rs.5 payable Rs.5 on application,Rs.10 on allotment (including premium) and the balance on first and final call. The company received applications for 22,500 shares and allotment was made pro rata. Bittoo to whom 1,200 shares were allotted, failed to pay the amount due on allotment. All his shares were forfeited after the call was made. The forfeited shares were reissued to Dheeraj at par. Assuming that no other bank transactions took place, the bank balance of the company after the above transactions is :
A) Rs.6,85,000
B) Rs.3,60,500
C)Rs.3,78,000
D)Rs.6,34,000

Question. Mithas Limited was formed with share capital of Rs. 50,00,000 divided into 50,000 shares of Rs.100 each. 9,000 shares were issued to the vendor as fully paid for purchase consideration of a furniture acquired. 30,000 shares were allotted in payment of cash on which Rs.70 per share was called and paid . State the amount of subscribed capital :
A) Rs. 50,00,000
B) Rs. 30,50,000
C) Rs. 30,00,000
D) Rs. 20,00,000

Question. Faltu Limited invited application for 2,00,000 shares of Rs.10 each. These shares were issued at premium of Rs.11 each which was allowed at the time of allotment. All money was called and duly received except on 10,000 shares on which only application money of Rs.3 per share was received.
The company forfeited all the shares. 7000 of forfeited share where re-issued at Rs.13per share. State the amount of securities premium to be shown under the head -Reserve and surplus.
A) Rs.20,00,000
B) Rs.11,11,000
C) Rs.8,11,000
D) Rs.21,11,000

Question. When nominal (face) value of a share is called up by the company but as some shareholders did not pay the money, the shares are forfeited . The share capital is shown in the balance sheet (notes) of a company under the following heading:
A) Subscribed and fully paid up
B) Subscribed but not fully paid up
C) Subscribed and called up
D) Subscribed but not called up

Question.A company forfeited 3,000 shares of Rs.10 each(which were issued at par) held by Kishore for nonpayment of allotment money ofRs.5 per share.The called up value per share was Rs.8.On forfeiture, the amount debited to share capital:
A)Rs.30,000
B)Rs.24,000
C)Rs.15,000
D)Rs.6,000

Question.Z limited issued shares of Rs.100 each at a premium of 10%. Mr. Q purchased 500 shares and paid Rs.20 on application but did not pay the allotment money of Rs.30. If the company forfeited his 30% shares, the forfeiture account will be credited by :
A) Rs. 4500
B)Rs. 3500
C) Rs. 1650
D) Rs. 3000

Question. Match the following :
a) Cumulative Pref. Share i)Repaid after some time
b) Participating Pref. Share ii) converts into equity shares
c) Redeemable Pref. shares iii) Dividend accumulates if not paid
d) Convertible Pref. shares iv) Gets share in surplus profit
The correct match is:
A) a-ii ,b-i, c-iii, d-iv
B) a-iii, b-iv, c-i, d-ii
C) a-iii, b-iv, c-ii ,d-i
D) a-ii, b-iv, c-iii, d-i

True/False:

Question.  True/ False :
Securities premium received on issue of shares cannot be used for the purpose of buy back of shares.  

Question. True/False-Share application amount is in the nature of Real account    

 Question. According to the below given information the final call per share is Rs.22.
The subscribed capital of a company is Rs. 80,00,000 and the nominal value of the share is 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 only . The balance in the calls in arrear amounted to Rs.55,000. 

Question. The options granted by the company to its employees and employee directors at a price that is lower than the market price is ______.

Question. When the shares are issued at a price more than the face value, it is known as share issued at________

Question. Excess balance amount of share forfeited account will be transferred to ___________ Account.

Question. The application money should be refund within _______ days from the closure of the issue.

Question. Actual number of shares offered to the public by the company for subscription is known as___________.

Question. Part of the issued capital offered for subscription to public is known as_________.

Question. When the called up amount is not paid by the shareholders then it will be transferred to _________ Account.

Question. A company must receive minimum subscription of _____ of shares before it allots the share.

Question. Share capital of a company is divided into small units .Every unit is known as __________

Question. At the time of forfeiture of shares Share Capital Account will be debited with ________________Value.

Question. Company can forfeit its shares.

Question. A Company can issue shares more than Authorised.

Question. Reserve capital is a part of unsubscribed capital.

Question. When the shares are issued at a price more than face value it is said that shares are issued at premium.

Question. When 90% of the issued shares are subscribed by the public it is known as over subscription of shares.

Question. A Company can issue shares at discount to public

Question. A Company can issue and allot shares to a select group of people privately.

Question. Equity share capital is also known as risk capital.;

Question. Securities premium reserve account will appear in the Balance Sheet

Question. When the shares subscribed are more than issued, it is known as undersubscribed of shares.