Question

Sort the following types of capital in the order of occurrence of event.

• A. Authorised Capital
• B. Issued Capital
• C. Subscribed Capital
• D. Called-up Capital
• E. Paid-up Capital

Answer 1

The decision of capital issue are made in this order:

1. The Memorandum of Association of every company has to specify the amount of capital with which it wants to be registered. The capital so stated is called authorised capital.
2. Issued capital is that part of authorised capital which is offered to the public for subscription in the form of shares.
3. Subscribed capital is that part of issued capital for which applications are received from the public.
4. Called-up capital is that part of subscribed capital which has been called up by the company.
5. Paid-up capital is that part of called up capital against which payment has been received from the members on their respective shares in response to the calls made by the company.