Question

Authorized capital is mentioned in capital clause of Memorandum of Association.

Options

• True

• False

Answer 1

This statement is True.

Explanation:

Authorized capital (also called nominal capital) is the maximum amount of capital that a company is legally allowed to raise by issuing shares. It is mentioned in the Capital Clause of the Memorandum of Association (MoA). The company cannot issue shares beyond this limit unless the MoA is amended following legal procedures.