Question : Securities Premium Reserve A/c has a ------------ and is a-----------, to be shown on the equity and liabilities side under the head -----------.
Option 1: Debit balance, capital profit, reserve and surplus
Option 2: Credited, revenue profit, reserve and surplus
Option 3: Credited, capital profits, reserve and surplus
Option 4: Credited, capital profit, shareholders' fund
Correct Answer: Credited, capital profits, reserve and surplus
Solution : Answer = Credited, capital profits, reserve and surplus
Securities Premium Reserve A/c typically has a credited balance and is considered a capital profit. It is shown on the equity and liabilities side of the balance sheet under the head "reserve and surplus." This reserve represents the excess amount received over the face value of shares issued as a premium. Hence, the correct option is 3.
Question : Puran Store Ltd., an Unlisted Company, is to redeem 5000,8% Debentures of Rs. 100 each on 30th June 2020. It has a balance of Rs. 10,000 in Debentures Redemption Reserve. It decides to set aside the amount to Debentures Redemption Reserve on 31st March 2020 on which date it has
following Reserves and Surplus: Rs. Securities Premium Reserve 25,000 Capital reserve Rs 20,000 General Reserve 30,000; and Surplus, i.e., Balance in Statement of Profit and Loss 30,000 Balance Rs. 40,000 can be set aside to Debentures Redemption Reserve from:
Option 1: Capital Reserve and General Reserve
Option 2: Capital Reserve and Securities Premium Reserve
Option 3: General Reserve and Surplus, i.e., Balance in Statement of Profit and Loss
Option 4: Securities Premium Reserve and Surplus, i.e., Balance in Statement of Profit and Loss
Question : Which of the following statements is incorrect?
Option 1: Premium on Issue of Debentures is a capital profit
Option 2: Premium on Issue of debentures are shown on the Equity and Liabilities side under the head ‘Reserves and Surplus’
Option 3: It is a liability and appears under the head “Non-Current Liabilities” under sub-head ‘Other Long term Liabilities’ till the redemption
Option 4: All of the above
Question : The Difference of assets and libilities side of balance sheet of a not for profit orgination is known as :
Option 1: General Reserve
Option 2: Reserve Fund
Option 3: Capital Fund
Option 4: Capital
Question : In a Company Balance Sheet, the credit (profit) balance of the Statement of Profit and Loss is shown under:
Option 1: Reserve and Surplus
Option 2: Current Liabilities
Option 3: Non-current Assets
Option 4: Non-current Liabilities
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