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Bharat limited was found was an authorised capital on 40 lakh dividend in equity share of 10 each first the companies should 5,000 share of its promoters as remuneration for services rendered by them at park s company also issued share at 10% premium to from and company for the purchase of a set of 550000 h general entries to record these transactions?
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Bharat limited was found was an authorised capital on 40 lakh dividend...
General Entries for Bharat Limited

1. Initial capital and dividend declaration

  • Authorized capital of Bharat Limited is 40 lakh equity shares of Rs. 10 each, amounting to Rs. 4 crore

  • Bharat Limited declares a dividend of Rs. 2 per share on its existing equity shares

  • Journal entry:


    • Debit: Retained Earnings Account - Rs. 80 lakh (40 lakh shares x Rs. 2 per share)

    • Credit: Dividend Payable Account - Rs. 80 lakh




2. Payment of promoters' remuneration in equity shares

  • Bharat Limited issues 5,000 equity shares of Rs. 10 each to its promoters as remuneration for services rendered by them

  • Market value of each share is Rs. 12

  • Journal entry:


    • Debit: Promoters' Remuneration Account - Rs. 60,000 (5,000 shares x Rs. 12 per share)

    • Credit: Equity Share Capital Account - Rs. 50,000 (5,000 shares x Rs. 10 per share)

    • Credit: Securities Premium Account - Rs. 10,000 (5,000 shares x Rs. 2 per share premium)




3. Issue of shares at a premium to Form and Company

  • Bharat Limited issues 55,000 equity shares of Rs. 10 each to Form and Company for the purchase of a set of machinery

  • Market value of each share is Rs. 12

  • Issue price is Rs. 11 per share

  • Journal entry:


    • Debit: Machinery Account - Rs. 6,05,000 (55,000 shares x Rs. 11 per share)

    • Credit: Equity Share Capital Account - Rs. 5,50,000 (55,000 shares x Rs. 10 per share)

    • Credit: Securities Premium Account - Rs. 55,000 (55,000 shares x Rs. 1 per share premium)




In summary, Bharat Limited declares a dividend, issues shares to its promoters as remuneration, and issues shares at a premium to Form and Company for the purchase of machinery. The journal entries for these transactions are recorded in the Retained Earnings, Dividend Payable, Promoters' Remuneration, Machinery, Equity Share Capital, and Securities Premium accounts.
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Bharat limited was found was an authorised capital on 40 lakh dividend in equity share of 10 each first the companies should 5,000 share of its promoters as remuneration for services rendered by them at park s company also issued share at 10% premium to from and company for the purchase of a set of 550000 h general entries to record these transactions?
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Bharat limited was found was an authorised capital on 40 lakh dividend in equity share of 10 each first the companies should 5,000 share of its promoters as remuneration for services rendered by them at park s company also issued share at 10% premium to from and company for the purchase of a set of 550000 h general entries to record these transactions? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Bharat limited was found was an authorised capital on 40 lakh dividend in equity share of 10 each first the companies should 5,000 share of its promoters as remuneration for services rendered by them at park s company also issued share at 10% premium to from and company for the purchase of a set of 550000 h general entries to record these transactions? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Bharat limited was found was an authorised capital on 40 lakh dividend in equity share of 10 each first the companies should 5,000 share of its promoters as remuneration for services rendered by them at park s company also issued share at 10% premium to from and company for the purchase of a set of 550000 h general entries to record these transactions?.
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