Question

Select the most appropriate answer from the alternatives given below and rewrite the sentence :

_____________ is deducted from the share capital to know paid up value of shares.
a) Calls-in-advance
b) Calls-in-arrears
c) Forfeited shares
d) Discount on issue

Answer 1

Calls-in-arrears is deducted from the share capital to know paid up value of shares.

Explanation: Calls-in-arrears represent the amount of capital called by a company but not paid by the shareholders. Calls-in-arrears are shown on the Liabilities side of the company’s Balance Sheet by way of deduction from the called-up capital to arrive at the net paid-up capital.