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Question
If forfeited shares are re-issued at a premium, the amount of such premium should be credited to_____.
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Solution
The correct option is D Securities Premium Account
The share premium account is an equity account found on a company's balance sheet. The amount in the account represents the additional amount shareholders paid for their issued shares that was in excess of the par value of those shares. If forfeited shares are re-issued at a premium, the amount of such premium should be credited to such account.
The share premium account is an equity account found on a company's balance sheet. The amount in the account represents the additional amount shareholders paid for their issued shares that was in excess of the par value of those shares. If forfeited shares are re-issued at a premium, the amount of such premium should be credited to such account.
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