S1: Under the Companies Act 2013, a company can buy back its shares up to 25% of its total paid-up equity capital in a financial year. S2: The debt-equity ratio should not exceed 2:1 after a buyback of shares. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: Under the Companies Act 2013, a company can buy back its shares up to 25% of its total paid-up equity capital in a financial year. S2: The debt-equity ratio should not exceed 2:1 after a buyback of shares. Which statement(s) is/are correct?
A. Both S1 and S2
B. S2 only
C. Neither S1 nor S2
D. S1 only
Answer: Option A
Solution (By JKSSB Mock Tests)
Section 68 of the Companies Act 2013 limits buyback to 25% of total paid-up equity capital in a year and mandates that the post-buyback debt-to-equity ratio must not exceed 2:1. Both are correct.
Under single entry, closing capital is ₹2,00,000; opening capital ₹1,50,000; drawings ₹20,000; additional capital ₹10,000. Profit for the year is:
No comments yet. Be the first to start the discussion!