Question

Difference between under subscription and oversubscription

Answer 1

Answer:

Difference is given below:-

Oversubscription:-

1)Shares applied:-Number of shares applied is more than the

shares offered for the subscription.

2)Acceptance:-All the applications are not accepted. Some are rejected. Alternatively, shares are allotted on pro rata.

3)Refund:-Excess application money is to be refunded or adjusted towards allotment.

Under subscription:-

1)Shares applied:-Number of shares applied is less than the

shares offered for the subscription.

2)Acceptance:-All the applications are accepted,i.e full allotment is made.

3)Refund:-As all the applications are excepted so no excess of money is refunded.

Thanks.....