Issue of share at a discount must be authorised by a resolution passed by the company in general meeting and duly sanctioned by the central government. As per Section 2(88) of the Companies Act, 2013, Sweat Equity Shares are the shares issued by the company to its Director or employee at a discount or for consideration other than cash, for providing know-how or making available like intellectual property rights or value addition.. Who are eligible for Sweat equity Shares? (a) Special resolution (b) Ordinary resolution (c) Unanimous resolution (d) None of these Ans. February – 2020 Edition Accountancy MCQs for Class 12 Chapter Wise with Answers PDF Download was Prepared Based on Latest Exam Pattern. Calculate the value of the sweat equity beyond the par value of the stock. Q9. It does not matter if such companies are private by its articles. Itâs a part ownership of the business and will stay forever unless the employee decided to sell his sweat equity share. Sweat equity is contribution to a project or enterprise in the form of effort and toil. 5%; 10%; 15%; 20%; Answer: (3) The Company shall not issue Sweat Equity Shares for more than 15% of existing paid-up share capital or issue value of shares Rs.5,00,00,000/- (Rupees Five Crores), whichever is higher. Sweat Equity is a new equity instrument which was floated in the Companies (Amendment) ordinance 1998 (u/s 79A of the companies act 1956. A rights issue is a way by which a listed company can raise additional capital. Accountancy MCQs for Class 12 Chapter Wise with Answers PDF Download was Prepared Based on Latest Exam Pattern. July – 2020 Edition Which of the following are the characteristics of a company? For example, if a corporation's share price is $10 and a person performed work worth $100,000, that person did work worth 10,000 shares. 2. âSweat equity sharesâ are such equity shares, which are issued by a Company to its directors or employees at a discount or for consideration, other than cash, for providing their know-how or making available rights in the nature of intellectual property rights or value additions, by whatever name called. If you want a shareholder to hold shares then an existing shareholder can transfer some of his or her shares or new shares could be allotted. Sweat Equity Shares issued at a discount must belong to a class of shares already issued. A company grants ESOPs to its employees for buying a specified number of shares of the company at a defined price after the option period (a certain number of years), Click to go to SEBI Grade A Preparation Page, Tags: Companies Act MCQ Part 4, Companies Act MCQ Part 4 Quiz, September – 2020 Edition (a) Question: Rate of brokerage for the deposits which have term between 1-2 years (a) 1.5% (b) 2% (c) 1% (d) None of [â¦] Difference between Equity Shares and Preference Shares. Match the following: Maximum number of members in: 5. Importance of Sweat Equity. Sweat equity compensates for the shortage of cash. For example, Bob receives $100 dollars in sweat equity from ABC Corp. Bob is required to pay taxes on the value of sweat equity received ($100 dollars) as earned income. As per Companies Act 2013, what is maximum tenure of preference shares except for infrastructure projects? Nothing contained in these regulations can be applied to any unlisted company. Equity share is an ordinary share. Sweat Equity Taxability. The Register of the Sweat Equity Shares will be maintained at the registered office of the company or any such other place as the Board may decide SH.3 and will forthwith enter the particulars of the Sweat Equity Shares issued under section 54. The term Company and Body corporate denote the same thing. Sweat equity is a form of income. Q7. Dear aspirants, The amount payable on application on every security shall not be less than five per cent. April – 2020 Edition Answer: (2) Answer: (2) A company may issue preference shares for a period exceeding twenty years for infrastructure projects. Financial Management MCQs (Multiple Choice Questions and Answers) Also Useful for NT…, 1. 13. Match the following: Minimum number of members in. The term âdirectorâ has been defined under section 2(34) of the 2013 Act. Kumar Nirmal Prasad on. MCQ - Issue of Shares and Share Capital | Multiple Choice Questions and Answers | Company Accounts | Corprorate Accounts | CMA MCQ by. “Sweat Equity Shares” means such equity shares as are issued by the Company to its Directors or Employees at a discount or for consideration, other than cash, for providing their know-how or making available rights in the nature of intellectual property rights or value additions, Q4. Only sweat equity shares can be issued at a discount. Body corporate does not include Co- operative society. Answer: (1) Answer: (4) Sweat Equity Shares are issue to _____? May – 2020 Edition About Kumar Nirmal Prasad Kumar Nirmal Prasad is the founder and CEO of Dynamic tutorials and Services. Objective Questions on Company Law with Answers: Question: A company to issue sweat equity shares must pass a. A Leading Coaching Centre of Tinsukia District for Commerece and Arts stream from 12! 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