Purchase of own shares

Purchase of own shares

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One of those I should know and should be able to find but....

Balance sheet is:

Share capital 120
Share premium 450
Profit & Loss Reserves 200,000

Company makes a purchase of own shares, being 5 shares for £10,000 paid out.

What would be the accounting entries and would this include a capital redemption reserve???
GG

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By User deleted
10th Jun 2008 16:19

journals
Assuming shares nominal value is £1 then
Dr £5 share capital
Dr £9,995 capital redemption reserve
Cr£10,000 bank

Hope that helps.

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By User deleted
13th Jun 2008 10:08

Entries
Dr Share Capital 5
Dr P/L Reserve 9995
Cr Bank 10000

Then

Dr P/L Reserve 5
Cr CRR 5

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By User deleted
13th Jun 2008 08:38

Wrong ?
How can you have a CRRF with £9995 debit balance ?

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