Maharashtra State BoardHSC Commerce 12th Board Exam
Advertisement Remove all ads

Select the Most Appropriate Answer from the Alternatives Given Below and Rewrite the Sentence : - Book Keeping and Accountancy

MCQ

Select the most appropriate answer from the alternatives given below and rewrite the sentence :
The excess price received over the par value of shares, should be ___________ to securities premium a/c.

Options

  • debited

  • credited

  • adjusted

  • none of these

Advertisement Remove all ads

Solution

The excess price received over the par value of shares should be credited to securities premium a/c.

Explanation: When shares are issued at a price above their par value, it is known as issuing of shares at premium. The excess amount received as premium is credited to a separate account known as Securities Premium Account. It is credited, as it is a gain for the company and is in the nature of nominal account.

Concept: Issue at Par and Premium and at Discount
  Is there an error in this question or solution?
Advertisement Remove all ads

APPEARS IN

Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 10 Company Accounts Part - 1 (Accounting for Shares)
Exercise | Q 13 | Page 351
Advertisement Remove all ads
Advertisement Remove all ads
Share
Notifications

View all notifications


      Forgot password?
View in app×