When preference shares are redeemed out of the Profit of the company, a reserve is created in the name of Capital redemption reserve.
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Company AccountsQ-1 | Redemption of Preference SharesQuestion 4920 of 112
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Detailed Solution & Explanation
True: When preference shares are redeemed out of the Profit of the com- pany, a reserve is
created in the name of Capital redemption reserve.
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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