Use the information below to answer this question. Mammy Plc, whose nominal capital is made...

JAMB 2015

Use the information below to answer this question.

Mammy Plc, whose nominal capital is made up of 5,000,000 ordinary shares at 50K each, decide to offer 80% of it to the public and realized only 50% of the amount due.

what is the company authorized share authorized share capital?

A. N4,000,000
B. N5,000,000
C. N7,500,000
D. N2,500,000

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Correct Answer: Option D

Explanation

From the calculation made we arrived at the answer and using the formula.

Nominal capital is the same as authorized x capital

The price per share is 50K

∴ Authorized share capital

=N5000000 x 0.50K

= N2,500,000

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