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Question
The Securities Premium Account should be shown under the head _____________.
The Securities Premium Account should be shown under the head _____________.
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Solution
The correct option is D Reserves and Surplus
Security
Premium Reserve is the additional amount charged on the face value of any share
when the shares are issued, redeemed, and forfeited. The
Companies Act 2013 states that when security premium has to be recorded in the
balance sheet, it done in the Reserve & Surplus mentioned under
the Equity & Liabilities of a company’s balance sheet. This
item is added under the head Reserve & Surplus. Moreover, reserve and surplus record all accumulated profits as well as losses.
Security Premium Reserve is the additional amount charged on the face value of any share when the shares are issued, redeemed, and forfeited. The Companies Act 2013 states that when security premium has to be recorded in the balance sheet, it done in the Reserve & Surplus mentioned under the Equity & Liabilities of a company’s balance sheet. This item is added under the head Reserve & Surplus. Moreover, reserve and surplus record all accumulated profits as well as losses.
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