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State Any Three Purposes Other than 'Issue of Bonus Shares' for Which Securities Premium Can Be Utilized. - Accountancy

State any three purposes other than 'issue of bonus shares' for which securities premium can be utilized.

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Solution

As per the Section 78 of the Companies Act of 1956, the amount of securities premium can be used by the company:

1) To issue fully paid bonus shares to the members.

2) To write-off preliminary expenses of the company

3) To buy-back its own shares or other securities.

Concept: Issue of Shares for Consideration Other than Cash
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