Question

Minimum subscription is the minimum amount that, in the opinion of directors, must be raised to meet the needs of business operations of the company relating to: (A) The price of any property purchased, or to be purchased, which has to be met wholly or partly out of the proceeds of issue;
(B) Preliminary expenses payable by the company and any commission payable in connection with the issue of shares;
(C) Working capital;
(D) Any other expenditure required for the usual conduct of business operations
Choose the correct answer from the options given below:

• A. (A), (B) and (D) only
• B. (A), (B) and (C) only
• C. (A), (B), (C) and (D)
• D. (B), (C) and (D) only

Hint:

Minimum subscription ensures that a company has enough funds to meet essential expenses like property, preliminary expenses, working capital, and other required operations.

Answer 1

The Correct Option is C

Step 1: Defining Minimum Subscription.
Minimum subscription is the legally mandated minimum sum a company must collect before it can issue shares.

Step 2: Allocation of Funds.
This amount must be allocated to cover: - The cost of property acquired or to be acquired.
- Initial expenses and any fees associated with share issuance.
- Operational capital.
- Other expenditures essential for the normal operation of the business.

Step 3: Determination.
Therefore, options (A), (B), (C), and (D) are all valid.

Final Answer: \[\boxed{(A), (B), (C) \text{ and } (D)}\]