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RIT Co is a limited liability company with 200,000 25c shares in issue. At
1 January the balance on the share premium account was $75,000. The following transactions occur during the year ended 31 December 20X6:
31 January There was a fully taken-up 2 for 5 rights issue. The issue price was $1.80.
12 August There was a 1 for 10 bonus issue made using the share premium account.
What are the balances on the share capital and share premium accounts of RIT Co at 31 December 20X6?Please do not type out a full question and expect to be provided with a full answer. You must have an answer in the same book in which you found the question, so ask about whatever it is in the answer that you are not clear about and then I will explain.
How to deal with this question is explained in detail in my free lectures on limited companies.
The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well 🙂
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