What is subscribed capital stock?
Matthew Harrington
Updated on December 31, 2025
Subscribed shares are shares that investors have promised to buy. These shares are usually subscribed as part of an initial public offering (IPO). Subscribed share capital refers to the monetary value of all the shares for which investors have expressed an interest. …
What is the journal entry for capital?
When you record the journal, you enter the capital introduced as a credit and post the opposite debit entry to the nominal ledger account you want to affect.
What is subscribed but not fully paid-up capital?
As per Section 2(86) of the Act, 2013, “Subscribed capital” means such part of capital which is for the time being subscribed by the members of a company. From the above definitions, it is clear that subscription money not paid, shall be included in the issued capital and subscribed capital.
How do you record an investment journal entry?
To record this in a journal entry, debit your investment account by the purchase price and credit your cash account by the same amount. For example, if your small business buys a 40-percent stake in one of your suppliers for $400,000, you would debit the investment account and credit cash each by $400,000.
Are shares debit or credit?
Some of the accounts have a normal credit balance, while others have a normal debit balance. For example, common stock and retained earnings have normal credit balances. This means an increase in these accounts increases shareholders’ equity.
How do you record shares issued in accounting?
Issuance of shares having no par value is recorded by debiting cash and crediting common stock or prefered stock. However if board of directors of the company assigns a value to shares orally, such value is called stated value and the journal entries will be similar to par value stock.
How do you record journal entry for common stock?
The entry to record the issuance of common stock at a price above par includes a debit to Cash. Cash is increased (debit) by the issue price. The journal entry would also include a credit to both Common Stock (increased) and Paid-In Capital in Excess of Par–Common Stock (increased).
What type of account is capital stock?
Account Types
| Account | Type | Debit |
|---|---|---|
| CAPITAL STOCK | Equity | Decrease |
| CASH | Asset | Increase |
| CASH OVER | Revenue | Decrease |
| CASH SHORT | Expense | Increase |
How do you record stock transactions?
The cost method of accounting for treasury stock records the amount paid to repurchase stock as an increase (debit) to treasury stock and a decrease (credit) to cash. The treasury stock account is a contra account to the other stockholders’ equity accounts and therefore, has a debit balance.
Is paid up capital an asset?
Paid-up capital is listed under the stockholder’s equity on the balance sheet. 2 This category is further subdivided into the common stock and additional paid-up capital sub-accounts. The price of a share of stock is comprised of two parts: the par value and the additional premium paid that is above the par value.
What is the difference between subscribed and paid up capital?
Paid-up share capital is the aggregate amount of money received from shareholders for shares issued. That part of the subscribed capital that remains to be paid is called “Calls in Arrears” or “unpaid share capital”.
How do you record an investment in a company?
Equity Method of Accounting The original investment is recorded on the balance sheet at cost (fair value). Subsequent earnings by the investee are added to the investing firm’s balance sheet ownership stake (proportionate to ownership), with any dividends paid out by the investee reducing that amount.
Subscribed shares are shares that investors have promised to buy. These shares are usually subscribed as part of an initial public offering (IPO). Subscribed share capital refers to the monetary value of all the shares for which investors have expressed an interest.
What is subscribed capital stock Philippines?
What is Subscribed Capital? A Subscribed capital refers to the number of shares issued to the shareholders.
How shall the 25% subscription requirement be computed where the capital stock consist only of par value shares?
Section 13 requires that the paid-up capital be not less than P5, 000.00. How is the 25% subscription requirement computed? Where the capital stocks consists only of no par value shares, the 25% requirement shall be computed on the basis of the “number of shares.
How do you increase subscribed capital stock?
Increase of Authorized Capital Stock
- Certificate of Increase of Capital Stock signed by majority of the directors and certified by Chairman and Corporate Secretary of the stockholders meeting.
- Treasurer’s Affidavit certifying the increase of capital stock, the amount subscribed and the amount received as payment thereto.
What is the difference between subscribed capital and paid-up capital?
Paid-up share capital is the aggregate amount of money received from shareholders for shares issued. Hence, the capital allotted and paid by shareholders is called paid-up capital. That part of the subscribed capital that remains to be paid is called “Calls in Arrears” or “unpaid share capital”.
What if there is no par value?
No-par value stock is issued without a par value. The advantage of no-par value stock is that companies can then issue stock at higher prices in future offerings. While no-par value stock is issued with no face value, low-par value stock is issued with a price as low as $0.01.
What is the difference between capital stock and treasury stock?
Capital stocks are the shares outstanding for a company. They may be purchased, and with them, an investor gains voting rights and sometimes dividends. Treasury stock, or treasury shares, are shares a company owns. They do not carry voting power and do not pay out dividends.
What does it mean to have subscribed share capital?
Subscribed share capital refers to the monetary value of all the shares for which investors have expressed an interest. Share capital can fall into one of several other categories, depending on where the company is in the equity-raising process. They include:
What is the definition of subscribed capital in the Philippines?
Subscribed Capital – the portion of the authorized capital stock that is covered by subscription agreements whether fully paid or not Outstanding Capital Stock – the total shares of stock issued to subscribers or stockholders, whether or not fully or partially paid except treasury shares so long as there is a binding subscription agreement
Which is the maximum amount of capital stock a company can issue?
Capital stock is the amount of common and preferred shares that a company is authorized to issue, according to its corporate charter. Capital stock can only be issued by the company and is the maximum number of shares that can ever be outstanding.
How many shares of capital stock do you own?
The amount of capital stock issued to different people, whether investors or shareholders, decides the percentage of the company that each person owns. For example, if there are 10,000 shares of capital stock and an investor owns 5,000 stocks, he owns 50 percent of the company.
