Question

When the company issues shares at a premium, the amount of premium can be received by the company along with:

Options

• Application money

• Allotment money

• Call money

• Any of the above or with all the above.

Answer 1

Any of the above or with all the above.

Explanation:

A company has the flexibility to collect the securities premium at any stage of the share issuance process. While it is most commonly collected during the allotment stage, the company’s directors can decide to receive it with the application money, during various calls, or distribute it across all these instalments.