Included in the share capital of Sundale Ltd were $200,000 in fully paid $1,10% redeemable preference shares.If the company redeems the shares at a 10% premium,the entries will include a:

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When the company redeems the preference shares at a 10% premium, it will have to pay $220,000 ($200,000 + 10% premium) to the shareholders. Therefore, there will be a credit entry to Cash for $220,000. The credit entry to Preference Share Capital for $200,000 will be reversed or cancelled as the preference shares are being redeemed.

Included in the Share Capital of Sundale Ltd Were $200,000