Authorised capital of a company is Rs.5 lakh and 40% of it is paid up. What would be the tangible net-worth of the company if it reported Loss during the year is at Rs.50,000 and has accumulated loss carried from last year of Rs.2 lakh.
The equity capital of the company = 40% of authorised capital = 40% of Rs.5 lakh = Rs.2,00,000 Total reserves at the end of the year = accumulated loss + current year loss = Rs.2 lakh + Rs.50000 = (-)2,50,000 Tangible net worth = equity + reserves = 2,00,000 + (-)2,50,000 = Rs.(-)50,000
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