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A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :
- a)Nil
- b)Rs. 2,00,000
- c)Rs. 3,00,000
- d)Rs.50,000
Correct answer is option 'D'. Can you explain this answer?
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A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, f...
Calculation of Amount to be Transferred to Capital Redemption Reserve Account
- Total number of redeemable preference shares = 3,000
- Face value of each preference share = Rs. 100
- Total amount of preference shares = 3,000 x Rs. 100 = Rs. 3,00,000
- Rate of dividend on preference shares = 12%
- Total dividend payable on preference shares = 3,00,000 x 12% = Rs. 36,000
- As per Section 80 of the Companies Act, 1956, a company is required to transfer at least 25% of the amount of redeemable preference shares before they are redeemed to a fund called Capital Redemption Reserve Account.
- 25% of Rs. 3,00,000 = Rs. 75,000
- However, the company has also issued 1,000 debentures of Rs. 100 each at 14% rate of interest.
- Total interest payable on debentures = 1,000 x Rs. 100 x 14% = Rs. 14,000
- As per Section 58A of the Companies Act, 1956, a company is required to create a Debenture Redemption Reserve Account for the purpose of redemption of debentures.
- Therefore, the amount to be transferred to Capital Redemption Reserve Account will be:
- Rs. 75,000 - Rs. 14,000 = Rs. 61,000
- However, the company has also issued 25,000 equity shares of Rs. 10 each at par.
- The amount received on these equity shares will only be utilized for the business operations of the company and not for creating any reserve.
- Therefore, the amount to be transferred to Capital Redemption Reserve Account is Nil.
- Hence, the correct answer is option 'D' - Rs. 50,000.
- Total number of redeemable preference shares = 3,000
- Face value of each preference share = Rs. 100
- Total amount of preference shares = 3,000 x Rs. 100 = Rs. 3,00,000
- Rate of dividend on preference shares = 12%
- Total dividend payable on preference shares = 3,00,000 x 12% = Rs. 36,000
- As per Section 80 of the Companies Act, 1956, a company is required to transfer at least 25% of the amount of redeemable preference shares before they are redeemed to a fund called Capital Redemption Reserve Account.
- 25% of Rs. 3,00,000 = Rs. 75,000
- However, the company has also issued 1,000 debentures of Rs. 100 each at 14% rate of interest.
- Total interest payable on debentures = 1,000 x Rs. 100 x 14% = Rs. 14,000
- As per Section 58A of the Companies Act, 1956, a company is required to create a Debenture Redemption Reserve Account for the purpose of redemption of debentures.
- Therefore, the amount to be transferred to Capital Redemption Reserve Account will be:
- Rs. 75,000 - Rs. 14,000 = Rs. 61,000
- However, the company has also issued 25,000 equity shares of Rs. 10 each at par.
- The amount received on these equity shares will only be utilized for the business operations of the company and not for creating any reserve.
- Therefore, the amount to be transferred to Capital Redemption Reserve Account is Nil.
- Hence, the correct answer is option 'D' - Rs. 50,000.
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A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer?
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A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer?.
A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer?.
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A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer?, a detailed solution for A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice A Ltd. had 3,000, 12%. Redeemable preference shares of Rs. 100 each, fully paid up. The company issued 25,000 equity shares of Rs. 10 each at par and 1,000 14%. Debentures of Rs. 100 each. All amounts were received in full. The payment was made in full. The amount to be transferred to capital Redemption Reserve Account Rs. :a) Nil b) Rs. 2,00,000 c) Rs. 3,00,000 d) Rs.50,000 Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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