alleryStart learning →The cost of right shares subscribed for is:
Aadjusted against share premium
Badded to original holding value
Ccharged off to profit and loss
Dtreated as a current investment
Answer & Solution
Correct answer: B. added to original holding value
Subscribing to rights increases the holding, so their cost joins the carrying amount of the original shares.
Keep practising AS 13 Accounting for Investments
Browse all AS 13 Accounting for Investments questions for CA Inter, or explore more Accounting topics.
Related questions
Profits on disposal of current and long-term investments are shown:Statements classify fixed assets, investments and current assets into:A readily realisable investment is meant to be held for 18 months. It is:A readily realisable investment made on 1 April is intended to be sold on 15 February nextIf dividend cannot be allocated except arbitrarily, cost is cut only if it:Interest and rentals on investments are shown separately for:A significant restriction on selling an investment must be:Disclosure of investments must include the policies for determining: