Examkin

Question

Difficulty: MediumClassification of Share Capital

Meridian Logistics Plc was registered with an authorized share capital of 5,000,0005,000,000 ordinary shares of ₦1.50\text{₦}1.50 each. The directors issued 3,000,0003,000,000 shares to the public and called up ₦1.00\text{₦}1.00 per share. If all called-up funds were received except a call of ₦0.20\text{₦}0.20 per share on 150,000150,000 shares, calculate the total paid-up share capital of the company in Naira.

Answer: 2970000 Naira

Answer

The paid-up capital of Meridian Logistics Plc is ₦2,970,000.
Paid-up capital represents the actual cash received from shareholders for called-up shares. The called-up capital is 3,000,000 shares×₦1.00=₦3,000,0003,000,000 \text{ shares} \times \text{₦}1.00 = \text{₦}3,000,000. Calls in arrears are 150,000 shares×₦0.20=₦30,000150,000 \text{ shares} \times \text{₦}0.20 = \text{₦}30,000. Deducting calls in arrears from called-up capital gives ₦3,000,000−₦30,000=₦2,970,000\text{₦}3,000,000 - \text{₦}30,000 = \text{₦}2,970,000.

Step-by-Step Solution

1
Calculate Total Called-up Capital
₦3,000,000
Multiply issued shares by called-up value per share (3,000,000 shares × ₦1.00).
2
Calculate Calls in Arrears
₦30,000
Multiply defaulting shares by unpaid call per share (150,000 shares × ₦0.20).
3
Compute Paid-up Capital
₦2,970,000
Subtract Calls in Arrears from Total Called-up Capital (₦3,000,000 - ₦30,000).

Key Concept

Classification of Share Capital - Paid-up Capital Calculation
Estimated Time:1m 30s
Rate this question

Topics

Classification of Share Capital

More questions from this topic