[amp_mcq option1=”Capital amount paid-up by share holders” option2=”Maximum amount of capital for which shares can be issued by the company” option3=”Total Share capital of the company” option4=”Total amount called-up on share capital” correct=”option2″]
The correct answer is: B. Maximum amount of capital for which shares can be issued by the company.
Authorised share capital is the maximum amount of capital that a company is allowed to raise by issuing shares. It is stated in the company’s memorandum of association and cannot be changed without the approval of the shareholders.
The other options are incorrect because:
- Option A is the paid-up capital, which is the amount of money that shareholders have actually paid into the company.
- Option C is the total share capital, which is the sum of the authorised share capital and the issued share capital.
- Option D is the total amount called-up on share capital, which is the amount of money that shareholders have been asked to pay into the company.