CS Executive · Corporate Accounting and Financial Management · Accounting for Share Capital
Under the Companies Act, 2013, the share capital of a company limited by shares can be of which two kinds?
The share capital of a company limited by shares is of two kinds: equity share capital, which may carry voting rights or differential rights, and preference share capital. Other labels such as authorised or subscribed describe stages of issue rather than the statutory kinds of capital.
- AEquity share capital and preference share capitalCorrect
- BAuthorised capital and subscribed capital
- CVoting capital and non-voting capital
- DFixed capital and reserve capital
Explanation
The Act provides that share capital of a company limited by shares is of two kinds: equity share capital (with voting rights or with differential rights) and preference share capital. Authorised and subscribed capital are classifications by stage of issue, not kinds of capital under the Act.
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