Learning Objectives
After studying this chapter, you will be able to:
- Explain the basic nature of a joint stock company as a form of business organisation and the various kinds of companies based on liability of their members.
- Describe the types of shares issued by a company.
- Explain the accounting treatment of shares issued at par, at premium, and at discount including oversubscription.
- Outline the accounting for forfeiture of shares and reissue of forfeited shares under varying situations.
- Workout the amounts to be transferred to capital reserve when forfeited shares are reissued.
- Prepare share forfeited account.