BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Issue of shares for cash
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Issue of shares for consideration other than Cash
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Both of the Above
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None of the Above
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Detailed explanation-1: -The consideration paid for the issuance of shares shall consist of money paid, labor done, or property actually received, and neither promissory notes nor the promise of future services shall constitute payment nor partial payment for shares of the Corporation.
Detailed explanation-2: -Generally, the Issue of Shares is of two kinds-common shares and preference shares.
Detailed explanation-3: -Shares issued for consideration other than cash can be issued at par, premium or discount.
Detailed explanation-4: -Section 43 of CA 2013 recognises both equity and preference as part of company’s share capital, and when equity is converted into preference or vice versa, the value of the subscribed and paid-up capital do not undergo any change.