Following was the Balance Sheet of BCC Ltd as on 31st December 2019 Equity Shares of 10 each mdash 8...........

Principles of Accounting & Financial Management Bonus and Right issue

Download Solution PDF

Following was the Balance Sheet of BCC Ltd. as on 31st December 2019:

Equity Shares of ? 10 each — ? 8,00,000

Securities Premium — ? 2,80,000

General Reserve — ? 1,40,000

Profit & Loss Account — ? 2,40,000

Sundry Creditors — ? 1,80,000

Company issued 3 bonus shares for every 4 fully paid-up shares. Securities prertium account will be utilized first and then General Reserve. To issue bonus shares Profit & Loss A/c will be debited by –

? 2,40,000

? 1,80,000

? 2,00,000 .

? 2,20,000

छोटे Courses बड़े Results

Master Bonus and Right issue

Prepare through Micro-courses

Try Now

Explanation:

(B) ? 1,80,000
Amount required for bonus issue = 8,00,000 × 34 = 6,00,000
P&L A/c balance to be used for bonus = 6,00,000 – 2,80,000 – 1,40,000 = 1,80,000