Frannie Plc has made a rights issue of 5 million new ordinary shares to raise cash. Each ordinary share of the company has a par value of 20 pence and the shares were issued at a premium of 280 pence. The current share price is 500 pence. What is the correct double entry required to record this transaction in the company's books of account?
A) Debit cash £14,000,000
Credit share premium £14,000,000
B) Debit cash £14,000,000
Credit share capital £1,000,000
Credit share premium £13,000,000
C) Debit cash £15,000,000
Credit share capital £1,000,000
Credit share premium £14,000,000
D) Debit cash £25,000,000
Correct Answer:
Verified
Q1: For the financial year ended 30 November
Q2: In the financial statements for the year
Q3: Jorge Limited has current assets of £4.5m
Q4: Tammy Plc has made a rights issue
Q6: Debit retained earnings, credit share capital, credit
Q7: Dither Limited has an issued share capital
Q8: Debit retained earnings, credit share capital, credit
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents