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WAEC Financial Accounting 1999 Question 50

Question 50

Company Accounts

When a shareholder fails to pay the calls requested from him, this situation leads to

  1. A.forfeiture of shares
  2. B.bonus shares
  3. C.over-subscription
  4. D.rights issue.
Show the answer and explanation

Answer: A (forfeiture of shares)

Explanation

Shares on which calls remain unpaid may be forfeited.