Accountancy, asked by wwwprasannpandey2000, 10 months ago

Which one of the following is not an application of fund (1) Repayment of loan (2) Acquiring as asset in lieu of equity shares (3) Redemption of preference shares (4) Payment of dividend

Answers

Answered by ramavtar79
2

Answer:

2 acquiring as asset in lieu of aquity shares

Answered by Chaitanya1696
0

We need to provide an answer as to what is not an application of fund and the correct answer is (2) Acquiring an asset in lieu of equity shares.

  • Let us understand why the second option is the correct option by taking the options one by one.
  • The first option given to us is the repayment of a loan and when a loan is repaid cash goes out of the company. So the cannot be the right answer.
  • The third option given to us is the redemption of preference shares. When the preference shares are redeemed or in other words when the preference shares holders are paid cash for their shares. This also deals with the money being paid so cannot be the correct answer.
  • The fourth option given to us is the payment of dividends. When dividends are paid it deals with cash being paid to the shareholders so this also cannot be the correct answer.
  • The second option is acquiring an asset in lieu of equity shares. This means shares are given to a person in exchange for the asset being bought by him. In this transaction, there is no application of funds.
  • Therefore, it is shown as above that only the second option is the correct option.

PROJECT CODE:#SPJ3

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