What Is Share Premium?


3 Answers

d ds Profile
d ds answered
All company’s stocks have a par or a face value assigned to them. It is also called the stock’s nominal value. Whenever stock is issued, it can be issued at a price above this nominal value. When the stock is sold at a value higher than the par value then it is said to be sold on a premium and the difference in the price between the issue price and the nominal value is called share premium. It is calculated as:
Share premium = Issue Price – Par value
The firms have a share premium account in which they list all the premiums that have been there in the past.
Ankit Srivastava Profile
If a share is issued on the higher price than the face value of it. The excess amount you pay, is called share premium.
Zingisa Benile Profile
Zingisa Benile answered
The amount higher than par value or an additional to par value.

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