Question

Which of the following is a Specific Reserve?

• A. General Reserve
• B. Dividend Equalisation Reserve
• C. Premium on Issue of Shares
• D. Reserve Capital

Answer 1

Answer:

B. Dividend Equalisation Reserve

Specific Reserve: Created for a particular purpose. Example: Dividend Equalisation Reserve is made to maintain a steady dividend even in years of low profit. General Reserve: Created from profits for general business purposes, not for a specific purpose. Premium on Issue of Shares & Reserve Capital: Related to capital, not for specific operational purposes.