ramesh purchased 100 shares@ rs. 120 per share and paid a brokerage of 0.5%. find out total amount spent by him. give journal entries for this investment.
Answers
total purchase of shares is 6.
five persant of 120 =6 so answer is 120+6=126
The answer to the following question is below.
Explanation:
Given:
Purchase Price = rs.120 per share
Brokerage = 0.5%
Number of Share = 100
Calculation:
Total Amount paid = (Purchase price x Number of share) + Brokerage paid
Total Amount paid = (120 x 100) + (120 x 100)0.5%
= 12,000 + 60
= 12,060
Journal Entry
In the Books of ( --- Limited)
Date Account Title and Explanation Debit Credit
Treasury Stock a/c Dr 12,000
Brokerage paid a/c Dr 60
To Bank a/c 12,060
(Being share purchased and paid 0.5% brokerage)
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