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Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-?
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Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of ...
**Calculation of Discounted Shares**
Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10%. To calculate the discounted price per share, we need to find 10% of ₹ 10, which is ₹ 1. Therefore, the discounted price per share is ₹ 10 - ₹ 1 = ₹ 9.
**Calculation of Amount for Redeeming Preference Shares**
The redeemable preference shares of ₹ 6,00,000 are to be redeemed using the proceeds from the issuance of the equity shares at a discounted price. The number of equity shares required to redeem the preference shares can be calculated by dividing the total amount required for redemption by the discounted price per share.
Amount required for redemption = ₹ 6,00,000
Discounted price per share = ₹ 9
Number of equity shares required = ₹ 6,00,000 / ₹ 9 = 66,667 shares (approx.)
Since Barkha Ltd. issued only 30,000 equity shares, it is not possible to redeem the entire ₹ 6,00,000 preference shares using the proceeds from the equity share issuance. Therefore, the company will be able to redeem only a portion of the preference shares.
**Creation of Capital Redemption Reserve Account**
The Capital Redemption Reserve Account is created to record the amount transferred from the share premium account or the profit and loss account for the purpose of redeeming preference shares. In this case, the company issued equity shares at a discount to redeem the preference shares.
To calculate the amount to be transferred to the Capital Redemption Reserve Account, we need to find the difference between the face value of the redeemed preference shares and the amount realized from the issuance of the equity shares.
Face value of redeemed preference shares = ₹ 6,00,000
Amount realized from issuance of equity shares = 30,000 shares * ₹ 9 = ₹ 2,70,000
Amount to be transferred to the Capital Redemption Reserve Account = Face value of redeemed preference shares - Amount realized from equity share issuance
= ₹ 6,00,000 - ₹ 2,70,000 = ₹ 3,30,000
Therefore, the amount to be transferred to the Capital Redemption Reserve Account is ₹ 3,30,000.
Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10%. To calculate the discounted price per share, we need to find 10% of ₹ 10, which is ₹ 1. Therefore, the discounted price per share is ₹ 10 - ₹ 1 = ₹ 9.
**Calculation of Amount for Redeeming Preference Shares**
The redeemable preference shares of ₹ 6,00,000 are to be redeemed using the proceeds from the issuance of the equity shares at a discounted price. The number of equity shares required to redeem the preference shares can be calculated by dividing the total amount required for redemption by the discounted price per share.
Amount required for redemption = ₹ 6,00,000
Discounted price per share = ₹ 9
Number of equity shares required = ₹ 6,00,000 / ₹ 9 = 66,667 shares (approx.)
Since Barkha Ltd. issued only 30,000 equity shares, it is not possible to redeem the entire ₹ 6,00,000 preference shares using the proceeds from the equity share issuance. Therefore, the company will be able to redeem only a portion of the preference shares.
**Creation of Capital Redemption Reserve Account**
The Capital Redemption Reserve Account is created to record the amount transferred from the share premium account or the profit and loss account for the purpose of redeeming preference shares. In this case, the company issued equity shares at a discount to redeem the preference shares.
To calculate the amount to be transferred to the Capital Redemption Reserve Account, we need to find the difference between the face value of the redeemed preference shares and the amount realized from the issuance of the equity shares.
Face value of redeemed preference shares = ₹ 6,00,000
Amount realized from issuance of equity shares = 30,000 shares * ₹ 9 = ₹ 2,70,000
Amount to be transferred to the Capital Redemption Reserve Account = Face value of redeemed preference shares - Amount realized from equity share issuance
= ₹ 6,00,000 - ₹ 2,70,000 = ₹ 3,30,000
Therefore, the amount to be transferred to the Capital Redemption Reserve Account is ₹ 3,30,000.
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Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-?
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Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-?.
Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Barkha Ltd. issued 30,000 equity shares of ₹ 10 each at a discount of 10% to redeem its redeemable preference shares of ₹ 6,00,000. capital redemption reserve account The amount to be transferred will be-?.
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