Abolique has recently gone through the process of issuing common shares. The following costs were incurred during
Question:
Abolique has recently gone through the process of issuing common shares. The following costs were incurred during the year:
• Underwriting fees: $15,000
• Professional fees (accounting and legal): $42,000
• Management salaries related to the share issuance: $30,000
• Printing fees (directly related to initial issuance of shares): $1,000
• Maintenance of shareholder records: $5,000
• Fees paid for share ownership transfers (including transfer agent fees): $2,500
Required:
1. Prepare a discussion of the options on how to record the transaction costs under IFRS. Prepare the journal entries for both methods.
2. Compare this to how the transaction costs would be reported under ASPE. Prepare the journal entries.
Step by Step Answer:
Intermediate Accounting Volume 2
ISBN: 9781260881240
8th Edition
Authors: Thomas H. Beechy, Joan E. Conrod, Elizabeth Farrell, Ingrid McLeod-Dick, Kayla Tomulka, Romi-Lee Sevel