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Issue of Shares- Simple Problems with Journal Entries Video Lecture | Advanced Corporate Accounting - B Com

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FAQs on Issue of Shares- Simple Problems with Journal Entries Video Lecture - Advanced Corporate Accounting - B Com

1. What are the common reasons for issuing shares?
Ans. Companies issue shares to raise capital for expansion, acquisitions, research and development, debt repayment, or to meet working capital requirements.
2. How are shares issued by a company recorded in the financial statements?
Ans. Shares issued by a company are recorded in the financial statements through journal entries that reflect the increase in share capital and cash or other assets received in exchange for the shares.
3. Can a company issue shares at any time?
Ans. A company can issue shares at any time as long as it complies with regulatory requirements, shareholder approvals, and the company's own articles of association.
4. How does issuing shares affect a company's ownership structure?
Ans. Issuing shares dilutes existing shareholders' ownership percentage in the company, as new shares are distributed among the existing and new shareholders.
5. What are the different types of shares that a company can issue?
Ans. A company can issue common shares, preferred shares, or other classes of shares with varying rights and preferences, depending on the company's needs and objectives.
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