alleryStart learning →Capital redemption reserve on buy-back from free reserves equals
ATotal consideration paid
BMarket value at offer date
CPremium paid on shares
DNominal value of shares
Answer & Solution
Correct answer: D. Nominal value of shares
Section 69 requires a transfer equal to the nominal value of the shares purchased, which preserves the capital base.
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Under Section 68, specified securities includeAfter a buy-back, a remaining investor's proportionate ownershipThe details of the transfer to capital redemption reserve are to be disclosed in the40,000 shares of face value Rs 5 are bought back at Rs 9. Equity share capital is debited Which can absorb the premium paid on a buy-back?Shares that a company has bought back areWithin six months after a buy-back, a company may still make aThe register of bought back shares is kept at the company's