POA@HGV_Grace_Chap 14_Equities_Private Limited Company

The amount of funds raised by issuing shares to shareholders.

• Share capital

• Dividends

• Retained earnings

All the profits or losses made by a private limited company from the beginning of its operations that have not been distributed to shareholders.

• Share capital

• Dividends

• Retained earnings

A portion of retained earnings that was distributed to shareholders.

• Share capital

• Retained earnings

• Dividends

Dividends =

• No of pieces of ordinary shares x Dividend rate

• Value of ordinary shares x Dividend rate

• Retained earnings x Dividend rate

State the double-entry for the transaction that took place on 10 October 2019.

• Dr Cash at bank $16 000

  Cr Dividends $16 000

• Dr Dividends $16 000

  Cr Cash at bank $16 000

• Dr Cash at bank $22 400

  Cr Dividends $22 400

• Dr Dividends $22 400

  Cr Cash at bank $22 400

State the double-entry for the transaction that took place on 11 November 2019.

• Dr Share capital $10 000

  Cr Cash at bank $10 000

• Dr Cash at bank $10 000

  Cr Share capital $10 000

• Dr Share capital $15 000

  Cr Cash at bank $15 000

• Dr Cash at bank $15 000

  Cr Share capital $15 000

State the double-entry for the transaction that took place on 9 September 2020.

• Dr Dividends $27 000

  Cr Dividends Payable $27 000

• Dr Dividends Payable $27 000

  Cr Dividends $27 000

• Dr Dividends $3 000

  Cr Dividends Payable $3 000

• Dr Dividends Payable $3 000

  Cr Dividends $3 000

• Dr Dividends $24 000

  Cr Dividends Payable $24 000

State the double-entry for the transaction that took place on 10 October 2020.

• Dr Dividends $27 000

  Cr Cash at bank $27 000

• Dr Dividends payable $27 000

  Cr Cash at bank $27 000

• Dr Cash at bank $24 000

  Cr Dividends $24 000

• Dr Cash at bank $24 000

  Cr Dividends payable $24 000

State the double-entry for the transfer of profit for the year to retained earnings account.

• Dr Income summary $170 000

  Cr Retained earnings $170 000

• Dr Retained earnings $170 000

  Cr Income summary $170 000

State the double-entry to transfer loss of the year to retained earnings on 30 June 2020.

• Dr Income summary $25 000

  Cr Retained earnings $25 000

• Dr Retained earnings $25 000

  Cr Income summary $25 000

• Dr Income summary $65 000

  Cr Retained earnings $65 000

• Dr Retained earnings $65 000

  Cr Income summary $65 000