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A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet?
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A company received application for 6lakh shares against issue of 5 lak...
Balance Sheet Presentation of Unallotted Shares
Unallotted shares are those shares for which allotment has not been made yet, but applications have been received. These shares are shown separately on the balance sheet to provide transparency to the investors and stakeholders about the company's financial position.
How to show unallotted shares on the balance sheet:
- Liabilities side: Unallotted shares are shown under the head 'Share Application Money Pending Allotment' on the liabilities side of the balance sheet. This represents the amount received from the shareholders who have applied for shares but have not been allotted yet.
- Amount: The total amount received from the applicants for the unallotted shares is shown in this account. In the given scenario, the company received applications for 6 lakh shares against the issue of 5 lakh shares. So, the excess applications for 1 lakh shares will be shown under this head.
- Disclosure: It is important to provide a disclosure in the notes to the financial statements regarding the unallotted shares. This disclosure should include the number of unallotted shares, the amount received against these shares, and the reasons for the delay in allotment.
- Treatment: Unallotted shares are considered as a liability for the company until they are either allotted or refunded to the applicants. It is essential to monitor and track these shares regularly to ensure timely allotment or refund to the shareholders.
By following these guidelines, the company can accurately present the unallotted shares on the balance sheet, providing a clear picture of its financial position to the investors and other stakeholders.
Unallotted shares are those shares for which allotment has not been made yet, but applications have been received. These shares are shown separately on the balance sheet to provide transparency to the investors and stakeholders about the company's financial position.
How to show unallotted shares on the balance sheet:
- Liabilities side: Unallotted shares are shown under the head 'Share Application Money Pending Allotment' on the liabilities side of the balance sheet. This represents the amount received from the shareholders who have applied for shares but have not been allotted yet.
- Amount: The total amount received from the applicants for the unallotted shares is shown in this account. In the given scenario, the company received applications for 6 lakh shares against the issue of 5 lakh shares. So, the excess applications for 1 lakh shares will be shown under this head.
- Disclosure: It is important to provide a disclosure in the notes to the financial statements regarding the unallotted shares. This disclosure should include the number of unallotted shares, the amount received against these shares, and the reasons for the delay in allotment.
- Treatment: Unallotted shares are considered as a liability for the company until they are either allotted or refunded to the applicants. It is essential to monitor and track these shares regularly to ensure timely allotment or refund to the shareholders.
By following these guidelines, the company can accurately present the unallotted shares on the balance sheet, providing a clear picture of its financial position to the investors and other stakeholders.
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A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet?
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A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet?.
A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company received application for 6lakh shares against issue of 5 lakh of 10 each . Allotment is yet to be made against the application received as at the end of date of balance sheet.how will u show it in balance sheet?.
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