Pious Limited purchases a machine worth ₹1,15,000 from Indigo Traders. Payment was made as ₹10,000 by cheque and the remaining by issue of equity shares of the face value of ₹10 each fully paid-up at an issue price of ₹1
CS CSEET · Business Economics & Fundamentals of Accounting and Auditing · PYQS · December 2013
Pious Limited purchases a machine worth ₹1,15,000 from Indigo Traders. Payment was made as ₹10,000 by cheque and the remaining by issue of equity shares of the face value of ₹10 each fully paid-up at an issue price of ₹10.50 each. Amount of share premium would be —
Answer & Explanation:
Correct Answer: Option (B)
Correct answer: (B) ₹5,000. Shares issued = (1,15,000−10,000)/10.50 = 10,000; premium = 10,000×0.50 = 5,000.
Topics: Fundamentals of Accounting and Auditing
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