31 August 2011
can anybody help me out, please prodive me with the treatment of bonus, preference shares dividend and proposed dividend, its urgent please....
05 October 2011
Assuming the bonus as Bonus shares, if the bonus shares are issued by the subsidiary company then the effect of the same to be given by reducing the general reserve of the company and increasing the share capital.
Also increase the amount of share capital used for calculating the goodwill / Capital Reserve.
If teh Bonus share are issued by Holding Company, the adjustment of reserves and share capital is required to be done
05 October 2011
Preference Dividend declared by Subsidiary
Preference shares hold by Holding Company- if preference dividend declared by subsidiary company will form part of profit and loss of holding company the reamianing share is to be shown as minority interest
Preference Shares not hold by Holding - whole preference share dividend to be form part of minority share
05 October 2011
Preference dividend declared by holding company -
the entry for provision of preference dividend to be passed in the books of holding company and similarly the laibilty to be provided in balance sheet for outstanding preference share dividend and also the profits to be adjusted accordingly
05 October 2011
When the Proposed dividend is declared by the Subsidiary company.
Please first check whether the propsed dividend is provided out of previous years profit or from post period profit
From Pre acquisition period - In such case the amount of proportion of holding company's share belonging to pre acquisition perid is to be deducted from the Cost of Investment/Holding while calculating Goodwill / Capital Reserve
From Post Acuisition period - The proportionate amount of holding company is to be transferred to Profit & Loss A/c of Holding Company
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