Hi,
Need advice on sale of shares by a holding company. The company structure is a holding company and a wholly owned trading susbisidary. One of the shareholders had their shares bought by the holding company. The Holding company has no assets apart from a bank account. The funds to pay for these share were transferred by the trading company. I think the correct journals are as follows:
Subsidiary
DR Share Captial 10
DR Share Premium 90
CR Bank 100
Holding company
DR Bank 100
CR Share Capital 100
Does this seem correct? Any advice is appreciated
Replies (1)
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Hi
Is trading subsidiary wholly owned by parent co? If so journal would be :
Subsidiary
Dr Intercompany loan 100
Cr Bank 100
Holding Co
Dr Bank 100
Cr Intercompany loan 100
Dr P&L account 100 for purchase of own shares fromprofits
Cr Bank 100
Dr Share capital 10
Cr Capital redemption res 10
Hope this helps