Making Account .com
The ShareHolder Allocate A Portion Of The Company Is Profits For The Development Of The Company, That Is Called The Revenue Reserve
Profit Other Than The Direct Profit Of The Company Is Allocated For The Long Term Need Of The Company That Is Called The Capital Reserve
The revenue reserve is allocated from the profit after tax
" The allocation system for both is the same "
profit and loss A/C | |
---|---|
particular | amount |
G/P | 20000 |
General Expenses | 900 |
tax | 100 |
N/P | 19000 |
(-) Reserve | 10000 |
(-)Dividends Are
Distributed
To Shareholders | 9000 |
(profit after tha tax paid) Profi available to shareholders | = 19000 |
Amount allocated To shareholder for the development of the company | = (-)10000 |
Profit Distributed To Shareholders | = (-)9000 |
(Revenue Reserve $10000) |
See the Depreciation chapter for more information and it will help you to know the reserve try now
The specific profits of the company are allocated in the capital reserve in terms of company law , This reserved amount does not provide directly to shareholders
The amount in the revenue reserve is transferred to the capital reserve to redemption of preference shares of the company(CRR)
Particular | basis | pre | post | |
---|---|---|---|---|
sales (1:3) | Sales | 500 | 1500 | |
salary ,office expenses , depreciation (4:8) |
time | 100 | 200 | |
director fees, interest on debenture (post) |
post | 60 | ||
advertisesment , sales man commission $ 120 (1:3) |
Sales | 30 | 90 | |
tax (4:8) | time | 30 | 60 | |
capital reserve | 340 | |||
n/P | 1090 |
liability | | | | asset | |||
capital | net profit | capital reserve | | | |
cash | |
---|---|---|---|---|---|
- | |||||
- | 1090 | 340 | | | 1430 |
company issued 1000 share at $10 each and $2 premium issued
100 share faild to pay first and second call money that share was forfeiture and reissued $8 fully paid up
date | particular | amount | amount |
---|---|---|---|
1 | bank A/C | 2000 | |
to share application A/C | 2000 | ||
. | . | . | . |
2 | share application A/C | 2000 | |
to share capital A/C | 2000 | ||
. | . | . | . |
3 | share allotment A/C | 4000 | |
to share capital A/C | 2000 | ||
to security premium A/C | 2000 | ||
. | . | . | . |
4 | bank A/C | 4000 | |
to share allotment A/C | 4000 | ||
. | . | . | . |
5 | share first call A/C | 2000 | |
to share capital A/C | 2000 | ||
. | . | . | . |
6 | bank A/C | 1800 | |
to arrears A/C | 200 | ||
to first call A/C | 2000 | ||
. | . | . | . |
6 | share second call A/C | 2000 | |
to share capital A/C | 2000 | ||
. | . | . | . |
6 | bank A/C | 1800 | |
to arrears A/C | 200 | ||
to second call A/C | 2000 | ||
. | . | . | . |
date | particular | amount | amount |
---|---|---|---|
1 | bank A/C | 800 | |
share capital A/C | 800 | ||
. | . | . | . |
particular | amount |
---|---|
issue of shares (100 * 10) | 1000 |
(-) paid up capital(100 * 4) | 400 |
called up share(100 * 6) | 600 |
(-)reissue of share(100 * 8) | 800 |
capital profit | 200 |
liability | amount | amount | asset | amount | |
---|---|---|---|---|---|
capital (1000 *10) | 10000 | cash | 12200 | ||
capital reserve | 2200 | ||||
Premium Of shares (1000 *2) | 2000 | ||||
profit of reissue of shares (100 *2) | 200 | ||||
12200 | 12200 |
purchased the machinery $1000 (01/04/19) , depreciation $150
date | particular | amount |
---|---|---|
19 | machinery | 1000 |
19-20 | depreciation | (-)100 |
20 | machinery | 9000 |
20-21 | depreciation | (-)100 |
21 | machinery | 8000 |
21-22 | depreciation | (-)100 |
22 | machinery | 7000 |
22-23 | depreciation | (-)100 |
23 | machinery | 6000 |
23-24 | depreciation | (-)100 |
24 | machinery | 5000 |
sale the machinery | (-) 7000 | |
capital gain |
2000 | |
tax 12% | (-)240 | |
capital profit | 1760 |
|
. | . | . |
sale the machinery $7000 (01/04/24)
debit | credit | |||
particular | amount | particular | amount | |
---|---|---|---|---|
expenses | 1000 | G/P | 4000 | |
tax 12% | 600 | profit on sale of asset | 2000 | |
N/P | 4400 | |||
6000 | 6000 |
liability | amount | amount | asset | amount | |
---|---|---|---|---|---|
capital (1000 *10) | 10000 | cash | 13960 | ||
capital reserve | 3960 | ||||
premium of shares (1000 *2) | 2000 | ||||
profit of reissue of shares (100 *2) | 200 | ||||
sale of asset | 1760 | ||||
13960 | 13960 |
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