Question

Which of the following should be deducted from the share capital to find out paid-up capital?

• A. Calls-in-advance
• B. Calls-in-arrears
• C. Share forfeiture
• D. Discount on issue of shares

Answer 1

The correct option is B Calls-in-arrears

If a shareholder is not able to pay the call amount due on allotment or on any calls according to the terms, the amount that becomes due is Calls-In-Arrears. We may transfer or not transfer the arrear amount on account of allotment or calls to Calls-in-Arrears Account.