Question

Nominal/Authorised share capital is:

• A. That part of the share capital which is issued by the company.
• B. The amount of share capital which is actually applied for by the prospective shareholders.
• C. The maximum amount of share capital which a company is authorised to issue.
• D. The amount actually paid by the shareholders.

Hint:

Memorise key terms like authorised, issued, subscribed, and paid-up share capital to differentiate between them.

Answer 1

The Correct Option is C

Nominal or authorised share capital signifies the maximum value of shares a company may legally issue, as stipulated in its Memorandum of Association. This figure establishes the ceiling for the share capital a company is permitted to raise. Consequently, the correct selection is (C).