The 3,000, 6% Redeenmable Preference Shares of R100 each, fully paid of XxY Ltd.
were due for redemption on 30 - 06-18 at a premium of 5%. The company made
an issue of 2,000 Equity Shares of T 100 each at a premium of 20% on the above
mentioned date. The issue was immediately subscribed and paid for. Expenses of
issue of the shares came toR 10,000. The General Reserve and P/L had balance of
3,50,000 and { 60,000 on 30 - 06-18. The redemption was carried out, holders
of 500 shares not being traceable. A bonus issue of 3,00,000 in the form of fully
paid equity shares was made.
Show the journal as summing that revenue reserve or surplus is to be used to the
minimum extent possible. (Amount transfe;red to C. R. R. Account 1,00,000)