equity

Question 1

share premium price example
A company raises. £60,000 by issuing 50,000 shares (normal value of £1) at the price of £1.20

Answer 1

share capital 50,000 = (50,000 x £1)
share premium 10,000 = (50,000 x 20p )
total =60,000

Question 2

preference shares example
A company A issues 1,000 NEW shares at a price of £5.
The shares have a nominal value at £3

Answer 2

debit bank £5000=(1000 x £5 )
credit share capital £3000=(1000 x £3
)
credit share premium £2000=(1000 x £2)

Question 3

Right issues example
A company A now makes a 1 for 4 rights issue at a price of £4 PER SHARE

Answer 3

currently 1,000 share issued
1of 4 rights issue so there are
1/4 x 1000 = 250 new shares
normal value of £3
issue price £4
debit bank 1000(250 x 4 )
credit share capital 750=(250 x £3)
credit share premium 250 =(250 x £1)

Question 4

irredeemable is

Answer 4

treated as equity so dividence , and reduces in retained earnings ,in statement changes in equity

Question 5

SOCIE( Statement of changes in equity )

Answer 5

across
ordinary , shares , irredeemable preference

down words
balance at

comprehensive income of period

dividends

shares issued

bounce issue balance