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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.
Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.
- a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
- b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
- c)Assertion (A) is true, but Reason (R) is false .
- d)Assertion (A) is false, but Reason (R) is true.
Correct answer is option 'D'. Can you explain this answer?
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Directions : In the following questions, a statement of Assertion (A)...
According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for the following purposes
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(i) To issue fully paid-up bonus shares to the shareholders.
(ii) To write off preliminary expenses of the companies.
(iii) To write off the commission paid or expenses on issue of shares/debentures.
(iv) To pay premium on the redemption of preference shares or debentures of the company.
(v) Buy-back of equity shares and other securities as per Section 68.
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Directions : In the following questions, a statement of Assertion (A)...
Understanding the Assertion and Reason
The question examines the relationship between the Assertion (A) regarding the use of the security premium amount for issuing partially paid-up bonus shares and the Reason (R) which references Section 52(2) of the Companies Act, 2013.
Assertion (A)
- The statement claims that the security premium amount can indeed be utilized for issuing partially paid-up bonus shares.
- This assertion is incorrect because the Companies Act does not permit the use of the securities premium for this purpose.
Reason (R)
- Reason (R) accurately reflects the provisions of Section 52(2) of the Companies Act, 2013.
- This section states that the Securities Premium Reserve can only be used for specific purposes, such as issuing fully paid shares, writing off preliminary expenses, or providing for the premium on redemption of debentures.
Conclusion
- Since Assertion (A) is false (the premium cannot be used for partially paid-up shares), and Reason (R) is true (it correctly describes the limitations on the use of the securities premium), the correct answer is option 'D'.
Summary of Options
- a) Both true, with R explaining A: Incorrect.
- b) Both true, R does not explain A: Incorrect.
- c) A true, R false: Incorrect.
- d) A false, R true: Correct.
This comprehensive understanding clarifies why option 'D' is the correct choice in this scenario.
The question examines the relationship between the Assertion (A) regarding the use of the security premium amount for issuing partially paid-up bonus shares and the Reason (R) which references Section 52(2) of the Companies Act, 2013.
Assertion (A)
- The statement claims that the security premium amount can indeed be utilized for issuing partially paid-up bonus shares.
- This assertion is incorrect because the Companies Act does not permit the use of the securities premium for this purpose.
Reason (R)
- Reason (R) accurately reflects the provisions of Section 52(2) of the Companies Act, 2013.
- This section states that the Securities Premium Reserve can only be used for specific purposes, such as issuing fully paid shares, writing off preliminary expenses, or providing for the premium on redemption of debentures.
Conclusion
- Since Assertion (A) is false (the premium cannot be used for partially paid-up shares), and Reason (R) is true (it correctly describes the limitations on the use of the securities premium), the correct answer is option 'D'.
Summary of Options
- a) Both true, with R explaining A: Incorrect.
- b) Both true, R does not explain A: Incorrect.
- c) A true, R false: Incorrect.
- d) A false, R true: Correct.
This comprehensive understanding clarifies why option 'D' is the correct choice in this scenario.
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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer?
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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer?.
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer?.
Solutions for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The security premium amount can be used to issue partially paid up bonus shares.Reason (R): According to Section 52(2) of the Companies Act, 2013, the amount of Securities Premium Reserve can be used only for some specific purposes.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
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