Statement of changes in equity entries: opening balances, share issues including at a premium, dividends paid, profit or loss for the year, closing balances
The statement of changes in equity tracks every movement in a company's ownership funds during the year. It records share issues, dividends paid out, and profit or loss earned.
Formula
Closing retained earnings = Opening retained earnings + Profit for year − Dividends paid
Real World
When Boohoo issued new shares at a premium to raise cash in 2020, the excess above nominal value went into a share premium account — a real entry you would show in the SOCE alongside any dividends paid to existing shareholders.
Exam Focus
Share premium is added to the share capital column only when shares are issued above nominal value; never include it in retained earnings.
Essay Framework
Use PEEL to structure every paragraph. Tap each step for guidance and an example.
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