A company has to redeem redeemable preference shares of the value of Rs. 1,00,000 at a premium of 10\% for which the company has issued 5,000 equity s - Accountancy MCQ CUET Accountancy 2022 8 Aug Shift 2 2026 | ExamTest.live

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A company has to redeem redeemable preference shares of the value of Rs. 1, 00, 000 at a premium of 10% for which the company has issued 5, 000 equity shares of Rs. 10 each at a premium of 20% . The amount to be transferred to capital redemption reserve account would be:

Solution & Step-by-step Explanation

Nominal value of preference shares to be redeemed = Rs. 1, 00, 000 .Nominal value of fresh equity shares issued = 5, 000 \times 10 = Rs. 50, 000 .Amount transferred to CRR = Nominal Value of Preference Shares redeemed - Nominal Value of fresh issue = 1, 00, 000 - 50, 000 = 50, 000 .

Try it yourself before checking the explanation above.

A company has to redeem redeemable preference shares of the value of Rs. 1, 00, 000 at a premium of 10% for which the company has issued 5, 000 equity shares of Rs. 10 each at a premium of 20% . The amount to be transferred to capital redemption reserve account would be:

Rs. 1, 00, 000

Rs. 50, 000

Rs. 1, 10, 000

Rs. 60, 000

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