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

    Question

    When the shares are issued for consideration other than

    cash which account will be debited
    A Securities Premium Correct Answer Incorrect Answer
    B Capital Reserve A/c Correct Answer Incorrect Answer
    C Vendor A/c Correct Answer Incorrect Answer
    D Share Capital A/c Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    When shares are issued for consideration other than cash, the company typically issues these shares in exchange for assets, services, or settling a liability. In such cases, the account representing the party from whom the assets or services are received, or the liability is settled, is debited. This is usually the Vendor Account, as it records the entity providing the assets or services.

    Practice Next
    More Financial Management Questions
    ask-question