CUET CUET Accountancy 2024 - Oversubscription is a situation where the | PYQs + Solutions

CUET Accountancy 2024

Accountancy

Accounting for Share Capital

Easy

Oversubscription is a situation where the

number of shares applied for is equal to the number of shares issued

number of shares applied for is more than the number of shares issued

number of shares applied for is less than the number of shares issued

face value of the share is less than the issue price of the share

Correct Option: 2

Oversubscription occurs when more investors want to buy shares than are available.

Option 2 means the number of shares applied for is greater than the number of shares issued.

This often happens in popular stock offerings, leading to competition among investors.

In contrast, the other options describe different situations that do not define oversubscription.