Other Accounting Rules

Question 1

Must dividends go through the profit and loss statement?

Answer 1

that goes straight to the changes on equity statement because it’s not an expense that decreases profits, merely a decision to distribute profits

Question 2

Must share issue costs be expensed?

Answer 2

No, they are accounted for as a reduction in equity and therefore, will be a line item on the statement of changes in equity, we cannot pass transactions with shareholders through the statement of profit and loss