BACHELOR OF BUSINESS ADMINISTRATION

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BUSINESS ADMINISTRATION

FINANCIAL ACCOUNTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Maximum amount Share Capital that a company can raise will be stated in the ____ of Memorandum of Association
A
Object Clause
B
Association Clause
C
Capital Clause
D
Liability Clause
Explanation: 

Detailed explanation-1: -In simpler words minimum or maximum authorised capital for private limited company under companies act, 2013 is Rs. 20 lakhs and they issue shares without applying for the increase in the Authorised Share Capital. The maximum capital of the private company is 50 lakhs.

Detailed explanation-2: -The Capital Clause is the fifth clause of the MOA, it serves the following functions: It specifies the share capital with which the company is being registered. It also states the maximum capital that that company is permitted to raise; this is often also referred to as authorised or nominal capital of the company.

Detailed explanation-3: -It is the maximum amount of capital for which shares can be issued. The amount of authorized share capital is mentioned in the Memorandum of Understanding (MOU) of the Company.

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