A company has in issue 1,000,000 preference shares of P10 each which are redeemable at par value. They are also convertible into 100,000 ordinary shares of P10 each. The company’s Articles provide that the preference shares are to be redeemed at par value and the proceeds of redemption are to be applied to subscribing for new ordinary shares. Prepare the journal entry to record the conversion.
A company has in issue 1,000,000 preference shares of P10 each which are redeemable at par value. They are also convertible into 100,000 ordinary shares of P10 each. The company’s Articles provide that the preference shares are to be redeemed at par value and the proceeds of redemption are to be applied to subscribing for new ordinary shares. Prepare the journal entry to record the conversion.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company has in issue 1,000,000 preference shares of P10 each which are redeemable at
par value. They are also convertible into 100,000 ordinary shares of P10 each. The company’s Articles provide that the preference shares are to be redeemed at par value and the proceeds of redemption are to be applied to subscribing for new ordinary shares. Prepare the journal entry
to record the conversion.
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