Setting up New company with 500 shares @$1000 each

[cometomama]

I need a bit of clarification, I got mind block…

I new to create a new company where it MUST have 500 shares issued @$1,000 each i.e. share capital of $500,000 to be established. and must have $500,000 in the bank. [That can be withdrew after the company creation]
There are 2 shareholder with 250 shares each.

One share holder paid all the monies he borrowed from his friend fixed interest $10,000, to get the company started however he withdrew 3,55,000 a week after the company was registered inclusive of $5,000 interest.
One shareholder did not contribute anything however he took 50,000 temporary loan.

Where shall I start

[lubos]

If it’s a company, then you should create for each shareholder their loan account.

When shareholder takes money out of the business, you will categorize the payment to their loan account. This way you will always know how much each shareholder owes to company.

Typically their loan accounts will get cleared once a year when company issues dividends to shareholders.

[cometomama]

Thanks for your reply,
I understand that part from your previous posts.
I am more interested in Share Capital Issue process.

[lubos]

Share register is not part of accounting record. Accounting software doesn’t need to know how much each shareholder has contributed to buy shares.

So it’s quite simple. In bank account, you receive money ($500,000) and allocate it to appropriate equity account (Share Capital).

[cometomama]

Thanks for clarification…