Bonus shares can be given to existing shareholder for providing them motivation. Accounting for bonus shares is very easy. You have just reduce your reserves for providing bonus shares. For providing bonus shares, we can debit the reserves of company and it can be transferred for providing bonus shares. In this accounting, all existing shareholders can adjust their money who did not pay full amount of their existing shares. Same amount can be adjusted with bonus shares and after this party paid up shares will become fully paid up shares. For more detail, you can read here.
AUTHOR:
Vinod Kumar ( Educator )
Vinod Kumar (born March 30, 1980) is an Indian Educator who is founder of SvTuition and Accounting Education a free online accounting education platform and an organisation with which he has written over 5000+ contents and video teaching lessons a wide subjects, focusing on accounting, finance, mathematics and science. Read more at https://www.svtuition.org/p/vinod-kumar.html
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