ACCA Applied Knowledge · Financial Accounting · The main elements of financial statements
Which of the following items would be presented within equity in a company's statement of financial position?
Share premium is presented within equity, as it arises from shares issued above nominal value. Debentures and trade payables are liabilities, and an undeclared proposed dividend is not recognised at the reporting date.
- AShare premiumCorrect
- BDebentures redeemable in five years
- CProposed final dividend not yet declared
- DTrade payables
Explanation
Share premium arises on issue of shares above nominal value and is part of equity. Debentures and trade payables are liabilities. A final dividend not declared by the reporting date is not a liability and is not recognised, so it does not appear in equity either.
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