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Categories explained: Share Premium
Categories explained: Share Premium
Steven Anderson avatar
Written by Steven Anderson
Updated over a week ago

A share premium account is normally found on a company’s balance sheet.

What this account does is either credit for money that has already been paid, money that has promised to be paid by a shareholder for a share.

However, this can only be the case when the amount of the share is greater than its original cost when paid by the shareholder.

One of the uses of this account is to write off expenses related to equity (i.e. underwriting costs, and may also be used to issue bonus shares).

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