In this article we will discuss about stock and shares of a company. Also learn about the difference between them. Stock: When all the shares of a company have been fully paid up, they may be converted into stock if so authorised by the Articles, as per Sec. 94(1) (c). It is another kind of unit of capital of a [...]
Here is a compilation of top six accounting problems on issue of shares with its relevant solutions. Problem 1 (Issue of Shares at Par—Journal, Cash Book and Balance Sheet): A Limited Company issued 25,000 Ordinary Shares of Rs. 25 each payable Rs. 5 on application, Rs. 10 on allotment and Rs. 5 each on subsequent calls, 20,000 shares were fully- [...]
In this article we will discuss about the accounting procedure for the issue of shares at discount, explained with the help of necessary journal entries and illustration. Generally a Company is not allowed to issue shares at a discount, i.e. at a price less than the face value of the shares. However, if a Company wants to raise capital by [...]