📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    Which of the following is not true about capital

    reserves?
    A Capital reserve is created from capital profits (e.g., revaluation surplus) Correct Answer Incorrect Answer
    B It is usually not available for distribution as dividend Correct Answer Incorrect Answer
    C It is part of shareholders’ funds Correct Answer Incorrect Answer
    D It is used to write off revenue losses Correct Answer Incorrect Answer
    E It can be used to issue bonus shares in some cases per law Correct Answer Incorrect Answer

    Solution

    Capital reserves are generally not used for writing off revenue losses; revenue reserves are used.

    Practice Next
    More Accounts Questions
    ask-question