A company issues 10,000 equity shares of ₹10 each at a premium of ₹5. The amount credited to Securities Premium A/c is: MCQ with Answer and Explanation

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A company issues 10,000 equity shares of ₹10 each at a premium of ₹5. The amount credited to Securities Premium A/c is:

A. ₹50,000

B. ₹10,000

C. ₹1,00,000

D. ₹1,50,000

Answer: Option A

Solution (By JKSSB Mock Tests)

Securities premium = shares * premium per share = 10,000 * 5 = ₹50,000.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

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A company declares dividend at 10% on equity shares of ₹10 each. On 5,000 shares, dividend amount is:

A. ₹5,000

B. ₹50,000

C. ₹500

D. ₹10,000

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Correct Answer: Option A

Explanation:
Dividend = 10% of (5,000 * 10) = 10% of 50,000 = ₹5,000.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

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Under 'Ind AS 21', foreign currency monetary items are translated at:

A. Closing rate

B. Historical rate

C. Average rate

D. Opening rate

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Correct Answer: Option A

Explanation:
Monetary items are translated at the closing rate at the reporting date.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

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Which concept dictates that personal expenses of the owner paid from the business account should be treated as drawings?

A. Business Entity Concept

B. Periodicity

C. Materiality

D. Conservatism

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Correct Answer: Option A

Explanation:
The Business Entity Concept treats the owner and the business as two distinct legal entities, separating personal and business transactions.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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