Question

16. If shares of Rs 4,00,000 are issued for purchase of assets of Rs 5,00,000, Rs 1,00,000
will be treated as
(A) Discount
(B) Premium
(C) Profit
(D) Loss​

Answer 1

Answer:

If shares of Rs $Rs.\:400000$ are issued for purchase of assets of $Rs.\:500000$, $Rs.\:100000$ will be treated as Discount.

Explanation:

As per data given in the question,

We have,

Purchase price of share = $Rs.\:400000$

Issued price of asset $=Rs.\:500000$

As Purchase price is less than the issued price, it means that the buyer will get some discout.

So, the difference which is $Rs.\:100000$ will be treated as discount.

Answer 2

Answer:

(B) Premium

Explanation:

Since lesser number of shares are issued to vendor. The balance of ₹1,00,000 will be premium on issue of shares.

    IF the shares  issued to vendorat premium vendors at a  vendors ,a/c DR $RS.5,00,000$

To share captial a/c is $RS.4,00,000$

TO security premium reserve  a/c is $RS.1,00,000$ It will be treated as Premium

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