Question

A company issued 10,000 shares of Rs. 10 each at a premium of 10%. The amount of premium will be:

• A. Rs. 10,000
• B. Rs. 20,000
• C. Rs. 8,000
• D. Rs. 5,000

Hint:

Securities Premium = (Face Value × Rate of Premium) × No. of Shares.

Answer 1

The Correct Option is A

Step 1: Calculate premium per share.
Face value of one share = Rs. 10. Premium = 10% of 10 = Rs. 1 per share.
Step 2: Total premium.
For 10,000 shares: \[ \text{Premium} = 10,000 \times 1 = Rs. 10,000 \]
Step 3: Conclude.
Hence, the total securities premium received will be Rs. 10,000.
Final Answer: \[ \boxed{Rs.\;10,000} \]