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WAEC Financial Accounting 1998 Question 27

Question 27

Company Accounts

Payment for shares in excess of amount demanded gives rise to

  1. A.dividend warrant
  2. B.revenue reserve
  3. C.capital reserve
  4. D.calls-in-advance
  5. E.calls-in-arrears.
Show the answer and explanation

Answer: D (calls-in-advance)

Explanation

Money received before a call is due is calls in advance.