Practicing Success
Securities Premium Reserve can be used for the following purposes. (A) To issue fully paid bonus shares Choose the correct answer from the options given below: |
(A), (B) and (E) only (A), (B) and (D) only (A), (B) and (C) only (C), (D) and (E) only |
(A), (B) and (C) only |
The correct answer is Option (3) → (A), (B) and (C) only The premium amount is credited to a separate account called ‘Securities Premium Account’ and is shown under the title ‘Equity and Liabilities’ of the company’s balance sheet under the head ‘Reserves and Surpluses’. It can be used only for the following five purposes: |