Archive about 'Limited Companies'

Limited Companies:Over-subscription Of Shares Issued

This article deals with a limited company which has a scenario of over-subscription of shares issued. The accounting entries are shown and an illustration being given for clearer understanding. When a limited company issue shares where the more shares are applied for than those available for issue, it results in the over-subscription of shares. Accounting [...]

Revision Notes On Limited Companies: Issue Shares On Installment & Method Of Raising Share Capital

  ISSUE SHARE ON INSTALLMENT Usually issues share in full amount or installment. When shares are issued as installment, an APPLICATION and ALLOTMENT Account is created · Where shares are issued and money is received from applicants at PAR VALUE (a)  Debit: Bank Account      Credit: Application & Allotment A/c  (b) Debit: Application & Allotment [...]

Profit And Loss Appropriation Account

The Profit And Loss Appropriation Account  For A Sole Trader :  The net profit is the entitlement of the owner and it is accordingly added to capital. Any drawings are deducted from capital   However for a Limited Company, a typical Profit And Loss Appropriation Account will look like below:              Profit And Loss Appropriation Account [...]

Issues of Shares and Debentures

When a company issues shares or debentures, one of the following three (3) scenarios might occur: Issuance AT PAR Issuance AT A PREMIUM Issuance AT A DISCOUNT Scenarios   Meaning Issuance AT PAR A share or debenture of (say) $1 each nominal value would be issued for $1 each. Issuance AT A PREMIUM At a [...]

Terms Used In Relation To Share Capital

Terms used in Relation To Share Capital Authorised Share Capital Also call Nominal Capital This is the total amount of share capital stated in the Memorandum of Association that can be offered for subscription Issued Capital This is the part of the authorized capital that has been offered to the public for subscription and has [...]

Long Term Sources Of Funds – Types of Share Capital (Part 2 of 3)

Short- term finance is generally borrowings that repayable within ONE year; Medium- term finance are those repayable within 2 to 5 years and Long-term finance repayable after more than 5 years This 2 nd part article seeks to look at Long term sources of fund which include the following: Share capital and Fixed Income Securities [...]