WHAT IS THE DIFFERENCE BETWEEN RESERVE CAPITAL AND CAPITAL
RESERVE?
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Answer Posted / aruna
RESERVE CAPITAL IS THE UNCALLED CAPITAL WHICH THE
SHAREHOLDERS CANNOT BE CALLED UPON TO PAY UNLESS THE
COMPANY GOES INTO LIQUIDATION.
CAPITAL RESERVE IS CREATED OUT OF PROFITS OF A CAPITAL
NATURE.EG;PREMIUMS RECEIVED ON THE ISSUE OF SHARES AND
DEBENTURES,SELLING A FIXED ASSET AT A HIGHER PRICE THAN ITS
BOOK VALUE etc....
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