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Question
Guru Ltd. invited applications for issuing 5,00,000 equity shares of Rs 10 each at a premium of Rs 5 per share. Because of favourable market conditions, the issue was over-subscribed and applications for 15,00,000 shares were received
Suggest the alternatives available to the Board of Directors for the allotment of shares.
Solution
The following three alternatives to the Board of Directors are:
a. Reject the excess application of 10,00,000 shares.
b. Allot shares to all the share applicants on pro-rata basis.
c. Reject few applications and allot shares on the proportionate basis to the remaining applicants.
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Give one word / Term / phrase for the following statement :
Shares having voting right.
State, whether the following statements is True or False.
Equity shareholder enjoys preferential rights.
The money received on rejected applications should be fully returned to the applicant within how many days of the date or issue of prospectus?
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Reason (R): Reserve Capital can be called up only at the time of winding up of the company.
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