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What is financial agreement and exchange of money for shares?
a TRANSACTION
Issuing shares of stock in exchange for cash is an example of?
financing activity
Is Buying shares listed on the Australian stock exchange is a primary market transaction?
yes it is a primary market transaction
What are the journal entries for issuing 45000 shares of common stock in exchange for land and building?
debit land and building 45000credit shares in share capital 45000
Does issuing capital stock in exchange for cash decrease or increase stockholder's equity?
Issuing capital stock in exchange for cash increases stockholders' equity. This is because it adds to the equity section of the balance sheet, as new shares are created and sold, contributing to the total capital of the company. The cash received boosts the company's assets while simultaneously increasing its equity, thereby enhancing the overall financial position.
What is a business enterprise that raises money by issuing shares of stocks?
A business that raises money by issuing shares of stock?
How do you journalize share transactions?
To journalize share transactions, you first identify the accounts affected and determine the transaction's nature, whether it's the issuance of new shares, the sale of treasury stock, or the repurchase of shares. For issuing shares, you typically debit cash or other assets received and credit common or preferred stock at par value, with any excess credited to additional paid-in capital. In the case of treasury stock transactions, you debit the treasury stock account and credit cash for the amount paid. Each entry must include the date, account titles, and a brief description of the transaction.
What is the journal entry to purchase asset from general reserve?
General reserves need to be converted into cash first by issuing new shares to share holders and after that cash can be used to purchase assets.
How are ETFs formed?
ETFs, or Exchange-Traded Funds, are formed by pooling together a diverse portfolio of assets, such as stocks or bonds, which are then bundled into a single fund. An authorized participant, typically a financial institution, creates new ETF shares by delivering the underlying assets to the fund manager in exchange for ETF shares. These shares can then be sold on an exchange, allowing investors to trade them like individual stocks. The process ensures liquidity and helps maintain the ETF's price in line with its net asset value.
Why goodwill account is debited while issuing shares to promoters of company?
When shares are issued to promoters in exchange for their contributions, such as intellectual property or business expertise, the goodwill account is debited to recognize the intangible value these contributions bring to the company. Goodwill represents the excess value over the tangible assets, reflecting the company's reputation and relationships. Debiting goodwill accounts in this context acknowledges that the promoters' involvement enhances the overall worth of the business, justifying the issuance of shares as compensation.
What is one major expense associated with issuing new shares of common stock?
Underpricing is one major expense associated with issuing new shares of common stock.
What is the journal entry for issuing 1000000 shares of 1 par common stock in exchange for legal services?
[Debit] Legal Services expenses 1000000 [Credit] Share capital account 1000000
