Multiple choice

10,000 equity shares of Rs. 10 each were issued to public at a premium of Rs. 2 per share. Applications were received for 12,000 shares. Amount of securities premium account will be

  1. Rs. 20,000

  2. Rs. 24,000

  3. Rs. 4,000

  4. Rs. 1600
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A Correct answer
Explanation

10,000 shares issued at Rs. 2 premium = Rs. 20,000 premium. Securities Premium Account is credited only on actually issued shares, not applications received. Excess applications (2,000) are rejected, so no premium on them.

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