Which of the following statement is Correct?
A. Conversion of Shares from larger to smaller denomination is Alteration of Capital
B. Refunding the Surplus paid up capital is Reduction of Capital
C. The Credit Balance of Capital Reduction is transferred to Capital Reserve Account
D. All the above
Answers
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Answer: D
Explanation:
Answered by
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Answer:
D
Explanation:
A. Shares of larger amounts into shares of smaller amounts. A company can make alteration in its share capital if it is authorized by its Articles of Association.
B. A company may have surplus funds and may want to return the surplus funds to shareholders by reducing capital or canceling some shares.
C. Any balance in the capital reduction account after the writing of lost capital is transferred to Capital Reserve Account.
Share cap. A/c ………….Dr. xx
To cap reduction A/c………Cr. xx
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