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Post Info TOPIC: Loan & Equity limited company
zetor1111


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Loan & Equity limited company
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Hi,

I need to clarify one thing:

The company was incorporated with 1 share @ nominal price £100 and the director intoduced £500 from his pocket.

I would book it as follows:

Cr £100 Equity a/c

Dr £100 Bank a/c

 

Cr £500 Director's loan a/c

Dr £500 Bank a/c

 

is that correct?



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Tomasz Szlachta
Robert Pearce


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That's correct, assuming that the shareholder has actually paid £100 to the company for his share.  As an aside, it''s quite unusual for a small company to have shares with a nominal value of £100 - do you mean 100 shares of £1 each?



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Pearce & Co - Chartered Accountant and Chartered Tax Adviser 

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These comments are outline only and are not a substitute for specific professional advice.
zetor1111


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yes this is correct, the shareholder has 1 ordinary share @ £100 nominal value. It was done incorrectly during incorporation process.(wrong way round) 



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Kind regards

Tomasz Szlachta
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