Internal reconstruction entries

Internal Reconstruction

1. Journal Entries
1Increase of Sharecapital
Cash a/c Drxxx
To Sharecapitala/c xxx
2Consolidation of Shares
Sharecapital a/c (Rs 10) Drxxx
To Sharecapital a/c (Rs.100) xxx
3Subdivison if Shares
Sharecapital a/c (Rs 100) Drxxx
To Sharecapital a/c (Rs.10) xxx
4Conversion of Shares into Stock
Equity Sharecapital a/c Drxxx
To Equity Capital Stock a/c xxx
5When Uncalled Capital is reduced
Sharecapital a/c (Rs 100) Drxxx
To Sharecapital a/c (Rs.60) xxx
6For Reducing Surplus Capital
Sharecapital a/c (Rs 100) Drxxx
To Sharecapital a/c (Rs.60) xxx
To Shareholders a/c (Rs40) xxx
7
For Reduction of Sharecapital when rights are
changed ( Either Face Value or Dividend Rate)
Sharecapital a/c Drxxx
To Sharecapital a/c xxx
To Capital Reduction a/c xxx
8For Reduction on Capital without Change in Rights
Sharecapitala/c Drxxx
To Capital Reduction a/c xxx
9
For any Sacrifice made by debenture holders or
creditors
Debenture a/c Drxxx
Creditors a/c Drxxx
To Capital Reduction a/c xxx
10For Appreciation in the value of Assets
Assets a/c Drxxx
To Capital Reduction a/c xxx
Alteration of Share Capital

2. 11For Payment of Scheme/ Reconstruction Expenses
Scheme/ Reconstruction Expenses a/c Drxxx
To Bank a/c xxx
12
For Payment of contingent Liabilities which
Materialise:
Contingent Liability a/c Drxxx
To Bank a/c xxx
13
When Shares are Surrendered by Shareholders as
per the scheme:
Sharecapital a/c Drxxx
To Surendered Shares a/c xxx
14
When Surrendered shares are reissued to
debenture holders:
Surrendered Shares a/c Drxxx
To Share Capital a/c xxx
15For Cancellling Unissued Surrendered Shares:
Surrendered Shares a/c Drxxx
To Capital Reduction a/c xxx
16
For Writing off Losses & Reducing Assets as per
scheme:
Capital Reduction a/c Drxxx
To P&L a/c xxx
To Preliminary Expenses a/c xxx
To Dis on Issue of Shares a/c xxx
To goodwill a/c xxx
To Patents a/c xxx
To Scheme/ Reconstruction Expenes xxx
To Contingent Liability (PAID) a/cxxx
To Assets a/c (Amt to be reduced )xxx
To Capital Reserve (Bal Fig) xxx