Exercise 13.18 The equity of Raw Prawn Ltd at 30 June 2019 consisted of: 397,500 ordinary 'A' shares issued at $2.00, fully paid $795,000 305,500 ordinary 'B' shares issued at $2.00, called to $1.20 366,600 51,000 6% preference shares issued at $1.50, fully paid 76,500 Share options issued at 65:, fully paid 27,040 Retained earnings 330,000 The options were exercisable before 28 February 2020. Each option entitled the holder to acquire two ordinary 'C' shares at $1.90 per share, the amount payable on notication to exercise the option. The following transactions occurred during the year ended 30 June 2020. 2019 Sept. 15 Nov. 1 30 Dec. 10 2020 Jan. 10 Feb. 28 Apr. 30 May31 June 18 26 27 3E) The preference dividend and the nal ordinary dividend of 16c per fully paid share, both declared on 30 June 2019, were paid. The directors do not need any other party to authorise the payment of dividends. A one-for-ve renounceable rights offer was made to ordinary 'A' shareholders at an issue price of $1.80 per share. The expiry date on the offer was 30 November 2019. The issue was underwritten at a commission of $3,200. Holders of 318,000 shares accepted the rights offer, paying the required price per share, with the renounced rights being taken up by the underwriter. Ordinary 'A' shares were duly issued. Money due from the underwriter was received. The directors transferred $33,300 from retained earnings to a general reserve. As a result of options being exercised, 70,000 ordinary 'C' shares were issued. Unexercised options lapsed. The directors made a call on the ordinary 'B' shares for 80c per share. Call money was payable by 31 May. All call money was received except for that due on 13,640 shares. Shares on which the nal call was unpaid were forfeited. Forfeited shares were reissued, credited as paid to $2.00, for $1.90 per share, the balance of the forfeited shares account being refundable to the former shareholders. Refund paid to former holders of forfeited shares. The directors declared a 18c per share final dividend to be paid on 15 September 2020. Ravi:r Prawn Ltd General journal entries Date Account and explanation September 15 Preference dividend payable V 4590 Cash V 4590 (Payment of preference dividend} Dividend payable ordinary A V 63600 Cash V 63600 (Payment of dividend of ordinary 'A' shares) Dividend payable ordinary B V 31?72 Cash V 31772 (Payment of dividend of ordinary 'B' shares) November 30 Cash v Receivable underwriter V Share capital ordinary A V 143100 (Issue of ordinary 'A' shares) Share capital - ordinary A 3200 Receivable - underwriter 3200 (Underwriting costs) December 10 Cash Receivable - underwriter (Payment from underwriter net of costs) 2020 January 10 Transfer to general reserve 33300 General reserve V 33300 (Transfer between reserves) February 28 Cash 133000 Options 27040 Options reserve V Share capital - ordinary C (Issue of ordinary 'C' shares)April 30 May 31 June 18 26 [Call ordinary B V' 244400 |:| Share capital ordinary B V E 244400 (Call on ordinary 'B' shares) Cash |l| Call ordinary B V (Receipt of call on ordinary 'B' shares) Share capital ordinary B V Forfeited shares account Call ordinary B (Forfeiture of shares) Cash Forfeited shares account |