At 31 July 20X9, the statement of financial position of Winder Engineering plc showed the following position:
Question:
At 31 July 20X9, the statement of financial position of Winder Engineering plc showed the following position:
The preference shares were originally issued at a premium of 10 per cent, and are redeemable at a premium of 5 per cent at any time during 20X9. The company decided it would redeem the preference shares. All transactions in respect of shares are as follows:
Required
a. Prepare the necessary journal entries to record the above transactions.
b. Prepare a statement of financial position at 30 September 20X9 which incorporates these changes.
ASSETS Sundry assets Cash Total assets EQUITY AND LIABILITIES Equity 200,000 equity £1 shares Share premium Retained earnings Total equity Non-current liabilities 80,000 10 per cent redeemable cumulative preference shares of £1 each Total liabilities Total equity and liabilities £ 380,000 60,000 440,000 200,000 20,000 140,000 360,000 80,000 80,000 440,000
Step by Step Answer:
ANSWER a Journal entries Date Account Debit Account Credit Amount Aug 1 Preference shares Cash 360000 Sep 1 Cash Share capital 30000 Sep 1 Share premi...View the full answer
Introduction To Financial Accounting
ISBN: 9781526803009
9th Edition
Authors: Anne Marie Ward, Andrew Thomas
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A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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