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WAEC Financial Accounting 2014 Question 31

Question 31

Company Accounts

Shares issued below nominal value are referred to as shares at

  1. A.premium.
  2. B.discount.
  3. C.face value.
  4. D.cumulative value.
Show the answer and explanation

Answer: B (discount.)

Explanation

Issuing shares for less than their nominal value is issuing them at a discount.