Issue of Shares & Debentures.pdf

School
National University of Computer and Technology*
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Course
MG 220
Pages
4
Upload Date
Feb 11, 2024
Uploaded by MinisterRaccoon4004 on coursehero.com
Page 1 of 4 Issue of Shares and Debentures Issue of Shares Rights Issue Transaction Debit Credit Cash Received (inc. Premium if any) Bank/Cash Share Applicants Account Nominal Value of Shares Allotted Share Applicants Account Share capital Share Premium (if any) Share Applicants Account Share Premium Bonus Issue Transaction Debit Credit Bonus Issue Reserve Account (as appropriate) Share Capital Issue for Cash Transaction Debit Credit Cash Received (inc. Premium if any) Bank/Cash Share Applicants Account Nominal Value of Shares Allotted Share Applicants Account Share capital Share Premium (if any) Share Applicants Account Share Premium Issue for Cash (oversubscribed) Transaction Debit Credit Total Cash Received (inc. Premium if any) Bank/Cash Share Applicants Account Nominal Value of Shares Allotted Share Applicants Account Share capital Share Premium (if any)on Shares Allotted Share Applicants Account Share Premium Excess amount refunded to applicants for shares oversubscribed Share Applicants Account Bank/Cash
Page 2 of 4 Issue for Cash (undersubscribed -Issue Underwritten ) Transaction Debit Credit Total Cash Received* (inc. Premium if any) Bank/Cash Share Applicants Account Nominal Value of Shares Allotted Share Applicants Account Share capital Share Premium (if any)on Shares Allotted Share Applicants Account Share Premium *Includes amount received from underwriters Issue for Cash at a Discount Transaction Debit Credit Cash Received Bank/Cash Share Applicants Account Nominal Value of Shares Allotted Share Applicants Account Share capital Share Discount Discount on Shares Account* Share Applicants Account *The balance on this account is deducted from Share Capital in the balance sheet Issue of Debentures/Bonds/Loan Notes Issue at Nominal Value Transaction Debit Credit Cash Received Bank/Cash Debenture Applicants Account
Page 3 of 4 Debentures Issued Debenture Applicants Account Debentures Issue at a Discount Transaction Debit Credit Cash Received Bank/Cash Debenture Applicants Account Debentures Issued (nominal value) Debenture Applicants Account Debentures Discount on Debentures Discount on Debentures Account* Debenture Applicants Account *The balance on this account is written off in equal annual amounts over the life of the debenture/in proportion to the debentures outstanding at the start of each year Issue at a Premium Transaction Debit Credit Cash Received Bank/Cash Debenture Applicants Account Debentures Issued (nominal value) Debenture Applicants Account Debentures Premium on Debentures Debenture Applicants Account Debenture Premium Account* *The balance on this account is shown as a revenue reserve in the balance sheet NOTE: Separate bank or cash accounts are used for the issue of shares/debentures. At the end of the transaction, the balance on these accounts is transferred to the normal bank/cash accounts of the company. Definitions Underwriter: A person or entity that, for a fee, undertakes to subscribe for any shares not allotted to applicants as a result of an under subscription. Share Option: An instrument that gives the holder the right to buy or sell a certain number of shares in the company by a specified date at a stipulated price. Where share options are issued at no cost to the
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