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

Hint:

To remember this concept, think of "Minimum Subscription" as the Survival Fund. A company isn't allowed to start its journey if it hasn't collected enough money to pay for its "house" (Property), its "setup fees" (Preliminary expenses), and its "monthly bills" (Working capital).

Answer 1

The Correct Option is C