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Profit on forfeiture & reissue of equity shares is credited to-
General reserve
Securities Premium
Capital reserve
Revenue reserve
- When shares are forfeited and later reissued, any profit made is often considered of a capital nature.
- General Reserve: It's used for general corporate purposes and not typically for profits from share transactions.
- Securities Premium: Arises when shares are issued at a price over their nominal value but isn't directly related to forfeiture and reissue profits.
- Capital Reserve: Often used for profits from transactions like the resale of forfeited shares. It's reserved for capital purposes and not for distribution as dividends.
- Revenue Reserve: Typically for profits generated from regular business operations.
By: Parvesh Mehta ProfileResourcesReport error
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