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P2 C3 Provisions and Reserves — Account STD 11 Commerce — Question

Gujarat BoardEnglish MediumSTD 11 CommerceAccountP2 C3 Provisions and Reserves1 Mark
Question
For what purposes can capital reserve be used?
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Answer

Capital reserve can be used for the following purposes: $(1)$ To write off capital losses, $(2 )$ To write off fictitious assets like discount on issue of debenture, preliminary expenses, etc. $(3 )$ To give bonus shares, if there is provision In Articles of Association of the company and $(4 )$ To write off intangible assets like goodwill, copyright, etc.

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