Day: August 4, 2024

Alex Ltd’s share capital consists of 20,000 times 25p equity shares all of which were issued at a premium of 20%.

The market value of the shares is currently 70p each.

What is the balance on the company’s equity share capital account?

Select ONE answer:

1. £5,000
2. £6,000
3. £14,000
4. £24,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – 20,000 shares * 25p = £5k
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.