Journal entry for new incoming shareholder

Accounting entry for investment by a new incoming shareholder

Didn't find your answer?

I have a client who recently formed a new company which doesn't have any goodwill. There are new incoming shareholders where the company would issue new shares to them by completing the SH01. My question is what could be the correct accounting entry for alloting new shares. The nominal value of the shares are £0.001 while the company issued some shares at £1 while others at £10 a share.

If the company issued 1,000 shares at £1 so total consideration is £1,000 so would this entry be correct.

DR     Bank                          £1,000

CR    Share Capital                           £1

CR   Share Premium                       £999

 

Replies (1)

Please login or register to join the discussion.

Routemaster image
By tom123
14th Nov 2017 11:04

Seems fine.
For an additional £9 of share capital you could have avoided messing around with fractions of pence.

Thanks (0)