Question

A company issued $10,000$ equity shares of Rs. $10$ each at a premium $20\%$ for the redemption of $15,000$ preference share of Rs. $10$ each. If the company had sufficient profit redemption reserve would be.

• A. Rs. $50,000$
• B. Rs. $1,00,000$
• C. Rs. $1,50,000$
• D. Rs. $30,000$

Answer 1

The correct option is A Rs. $50,000$

b'15,000 preference share of Rs. 10 each [15,000 x 10 = 1,50,000]

10,000 equity shares of Rs. 10 each [ 10,000 x 10 = 1,00,000]

preference shares 1,50,000

Less- equity shares 1,00,000

50,000.

'