Question

Consider the following statements:
1. The bonus shares shall not be issued in lieu of dividend,
2. A company may issue fully paid up bonus shares to its members out of its 'Capital Redemption Reserve Account'
3. A company may not issue bonus shares out of its 'Securities Premium Account'
Which of the above statement/s is are not correct?

• A. 1, 2, and 3
• B. Only 1
• C. Only 2
• D. Only 3

Answer 1

The correct option is D Only 3

A company may not issue bonus shares out of its 'Securities Premium Account'