How may a Company utilize its Securities Premium Reserve as per Companies Act, 2013?
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Partnership and LLP AccountsQ-1 | Partnership and LLP AccountsQuestion 4876 of 108
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Detailed Solution & Explanation
Issue of shares (at premium) [Section 52]:
A company may utilise its Securities Premium for the following purposes only:
(1) for issuing fully paid bonus shares.
(2) for writing off of the preliminary expenses of the Company.
(3) for writing off of the discount on issue of shares, if any.
(4) for writing off of expenses, brokerage, commission etc. on issue of shares/ debentures.
(5) for providing premium on redemption of preference shares.
(6) for buyback of own shares of Company.
SHORT QUESTIONS
About This Chapter: Partnership & Companies
Paper
Paper 1: Accounting
Weightage
15-20%
Key Topics
Admission, Retirement, Death, Shares, Debentures
This chapter covers Admission, Retirement, Death, Shares, Debentures and is part of Paper 1: Accounting in the CA Foundation exam.
View Official ICAI SyllabusExam Strategy Tip
This topic carries 15-20% weightage. Focus on understanding core concepts rather than memorizing.
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