Question

The amount received over and above the par value is credited to which account?

• A. Paid up Capital A/c
• B. Calls-in-advance A/c
• C. Securities Premium A/c
• D. Share Forfeiture A/c

Hint:

Excess over par value = Securities Premium → credited to Securities Premium A/c (Reserves & Surplus).

Answer 1

The Correct Option is C

Step 1: Par value vs. premium.
Par value (face value) is the nominal value of shares. If company issues shares above par, the excess amount is called “securities premium”.
Step 2: Accounting treatment.
This extra amount is not credited to Capital A/c but to a separate account called “Securities Premium A/c” under Reserves and Surplus in Balance Sheet.
Step 3: Conclude.
Hence, the amount received over and above par value is credited to Securities Premium A/c.
Final Answer: \[ \boxed{\text{Securities Premium A/c}} \]