Question

The maximum amount beyond which a company is not allowed to raise funds, by issue of shares is known as ___________.

• A. issued capital
• B. reserve capital
• C. nominal capital
• D. subscribed capital

Answer 1

Answer: (C)

nominal capital

Authorised capital or registered capital or nominal capital of a company is the amount of share capital that the company is authorised to raise capital through public. Basically the capital that is registered in the memorandum of association of the company. The company cannot raise money beyond the Authorised capital or registered capital or nominal capital so registered.