| Read the following hypothetical text and answer the given questions: |
| Xen Ltd. was incorporated on 1st April, 2019 with registered office at Delhi. The capital clause of Memorandum of Association reflected on Authorised Capital of Rs. 25,00,000. |
| Equity share Capital being 1,50,000 shares of Rs.10 each and Preference share capital being 10,000 shares of Rs. 100 each. |
| The promoters of the company were compensated by issuing 1,000 Equity Shares for their efforts in the project and expenses incurred by them. Besides this, 10,000 Equity Shares were issued to underwriters for their underwriting services. |
| The company offered to public 1,25,000 Equity Shares and 5,000, 10% Preference Shares at par for subscription, amount being payable along with application. |
| Applications were received for 1,25,000 Equity Shares and 3,500, 10% Preference Shares. |
| Based on the above information you are required to answer the following questions: |
| What amount of preference share capital is issued by the company? |
A) Rs. 5,00,000
B) Rs. 3,50,000
C) Rs. 8,50,000
D) Rs. 19.00,000
Correct Answer: A
Solution :
| [a] Rs. 5,00,000 |
| Hint: Issued Preference Share Capital |
| = (5,000 \[\times \] 100) =Rs. 5,00,000 |
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