accounting entry for preference shareholders.

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HIMANSHU TIWARI (Querist)
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01 October 2007 what is entry in case of pre.shareholer should pass in transferor books in purchase & pooling interest methods.Is
this right in PIM method that in tranferor books we have to debited preference shares and credited preference shareholsers then pay it off from consideration received from the transferee company. what ? arises when pc does not includes it how could it be happen.

KAAPIL

KAAPIL (Expert)
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31 October 2007 Preference Shareholders may get new preference shares or cash they will be transferred from old to new or their account will be closed. Hence you need to debit the capital and credit them and by payment or shares reverse them.