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Sources of Finance
Shares Issued and Paid For in Full on Application - At a Premium
Worked Example
Biz/ed plc issued 10,000 ordinary shares at a price of £5 per share that have a par value of £2 per share - that's a share premium of £3 per share. Applications were received for exactly 10,000 shares and these were then allocated and issued. Complete the bookkeeping requirements for this share issue.
Solution
Biz/ed plc
| Shares issued | 10000 | |
| Par value per share | 2 | |
| Issue price | 5 | |
| |
| Received in full on application and allotted immediately | |
| |
| Dr | Cr |
| Application and Allotment a/c par value | 20000 | |
| Application and Allotment a/c share premium | 30000 | |
| Balance c/d | | 50000 |
| | 50000 | 50000 |
| |
| |
| Ordinary Share Capital a/c | 20000 | |
| Share Premium a/c | 30000 | |
| Bank a/c | | 20000 |
| Bank a/c | | 30000 |
| | 50000 | 50000 |
| |
| |
| Application and Allotment a/c | | 20000 |
| |
| |
| Application and Allotment a/c | | 30000 |
For you to do
Biz/ed plc issued 25,000 ordinary shares at a price of £12 per share that have a par value of £3.75 per share - that's a share premium of £8.25 per share. Applications were received for exactly 25,000 shares and these were then allocated and issued. Complete the bookkeeping requirements for this share issue.
You can complete this task either by filling in the interactive form below or on paper using the printable worksheet. N.B. Do not insert commas or spaces between your figures in the boxes below.
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