Is reserve capital is included in unsubscribed or or uncalled capital
Answers
It is included in uncalled capital
“Capital Reserve” means the part of profit reserved by the company for a particular purpose such as to finance long-term projects or to write off capital expenses. If we reverse the words, then we get a new term “Reserve Capital”. The two terms might seem alike to a layman, but these are not one and the same thing, as they carry different meanings. Reserve Capital shows the part of the authorized capital that has not yet called up by the company and is available for drawing, if necessary.
BASIS FOR COMPARISON CAPITAL RESERVE RESERVE CAPITAL
Meaning :The profit earned by the company through special transaction, that is not available for distributing dividend to shareholders is known as Capital Reserve. The part of uncalled capital, that is called up only on the event of company's liquidation is known as Reserve Capital.
Created out of: Capital profits ; Authorized capital
Disclosure: On the equity & liabilities side of the balance sheet under the head Reserve and Surplus. Not disclosed at all
Need of creation: Mandatory; Voluntary
Specific condition: No such conditions; Special Resolution should be passed at AGM
Utilization: To write of fictitious assets or capital losses etc. Only when the company is about to wind up.