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13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column?
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13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It iss...
Journal Entries for Haneesh Ltd.
To record the purchase of land by issuing equity shares, Haneesh Ltd. will need to make the following journal entries:
Explanation of Journal Entries
- Land Account (Dr.): This entry represents the asset acquisition. The land purchased is recorded at its cost, which is Rs. 40,000. The debit to the Land account increases the asset on the balance sheet.
- Equity Share Capital Account (Cr.): This entry reflects the issuance of shares to settle the payment for the land. By crediting the Equity Share Capital account, Haneesh Ltd. recognizes the increase in its capital due to the issuance of shares.
- Transaction Description: The last line provides a brief explanation of the transaction, indicating that the purchase was made using equity shares instead of cash.
Conclusion
These entries help maintain accurate financial records and reflect the company's financial position accurately. By issuing shares, Haneesh Ltd. avoids immediate cash outflow while acquiring an asset, thus supporting its growth strategy.
To record the purchase of land by issuing equity shares, Haneesh Ltd. will need to make the following journal entries:
| Date | Particulars | Debit (Rs.) | Credit (Rs.) |
|---|---|---|---|
| DD/MM/YYYY | Land A/c Dr. | 40,000 | |
| To Equity Share Capital A/c | 40,000 | ||
| Being land purchased from Dhaya Bros. by issuing equity shares. |
Explanation of Journal Entries
- Land Account (Dr.): This entry represents the asset acquisition. The land purchased is recorded at its cost, which is Rs. 40,000. The debit to the Land account increases the asset on the balance sheet.
- Equity Share Capital Account (Cr.): This entry reflects the issuance of shares to settle the payment for the land. By crediting the Equity Share Capital account, Haneesh Ltd. recognizes the increase in its capital due to the issuance of shares.
- Transaction Description: The last line provides a brief explanation of the transaction, indicating that the purchase was made using equity shares instead of cash.
Conclusion
These entries help maintain accurate financial records and reflect the company's financial position accurately. By issuing shares, Haneesh Ltd. avoids immediate cash outflow while acquiring an asset, thus supporting its growth strategy.
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13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column?
Question Description
13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about 13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for 13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column?.
13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about 13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for 13. Haneesh Ltd. Purchased land for Rs. 40,000 from Dhaya Bros. It issued equity shares of Rs. 10 each fully paid up in satisfaction of their claim. Make journal entries to record these transactions in tabular column?.
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