Question

state any two purposes for which the balance of securities premium account can be utilized.​

Answer 1

Answer:

Securities Premium Account can be used for writing off any preliminary expenses of the company. To write off expenses of issue of shares and debentures, such as commission paid or discount given on the issue of shares.

Answer 2

Two purpose for which the balance of security premium reserve an be utilized are -

• As per the provision of Companies Act 2013 company can utilise the amount of the Security pre,ium reserve as mentioned in section 52 of the companies act 2013.
• Security Premium Reserve can be utilised to pay off premilinary expenses.
• It can be utilized to pay off the premuim on redemption of debentures.
• It can also be utilized to write off expense on issue of share and debentures.
• It can also be utilized to issue the fully paid up bonus share.