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Emma limited wishes to redeem its preference shares amounting ₹10000 at a premium of 5%.And for this purpose, issues 5000 equity shades of ₹10 each at premium of 5%.The company has also a balance of ₹,100000 in profit.And loss account journalized the above?
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Emma limited wishes to redeem its preference shares amounting ₹10000 a...


Journal Entry for Redemption of Preference Shares and Issuance of Equity Shares


Redemption of Preference Shares:

  • Cash A/c Dr - ₹10,500 (₹10,000 + 5% premium)
  • Preference Share Capital A/c Cr - ₹10,000
  • Securities Premium A/c Cr - ₹500


Issuance of Equity Shares:

  • Bank A/c Dr - ₹52,500 (5000 shares x ₹10 + 5% premium)
  • Equity Share Capital A/c Cr - ₹50,000
  • Securities Premium A/c Cr - ₹2,500


Adjustment for Profit and Loss Account:

  • Profit and Loss A/c Dr - ₹10,000
  • General Reserve A/c Cr - ₹10,000


After these journal entries, the company's balance sheet will reflect the redemption of preference shares, issuance of equity shares, and the adjustment for the profit and loss account. This will help in maintaining the financial health of the company and ensure proper allocation of funds.



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Emma limited wishes to redeem its preference shares amounting ₹10000 at a premium of 5%.And for this purpose, issues 5000 equity shades of ₹10 each at premium of 5%.The company has also a balance of ₹,100000 in profit.And loss account journalized the above?
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Emma limited wishes to redeem its preference shares amounting ₹10000 at a premium of 5%.And for this purpose, issues 5000 equity shades of ₹10 each at premium of 5%.The company has also a balance of ₹,100000 in profit.And loss account journalized the above? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Emma limited wishes to redeem its preference shares amounting ₹10000 at a premium of 5%.And for this purpose, issues 5000 equity shades of ₹10 each at premium of 5%.The company has also a balance of ₹,100000 in profit.And loss account journalized the above? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Emma limited wishes to redeem its preference shares amounting ₹10000 at a premium of 5%.And for this purpose, issues 5000 equity shades of ₹10 each at premium of 5%.The company has also a balance of ₹,100000 in profit.And loss account journalized the above?.
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