EXERCISE 8.10 8.10 The following is the trial balance of Missy Limited at 31 December 2015: DR R CR R 800 000 4 800 634 125 99 000 39 040 Ordinary share capital (320 000 shares) Retained earnings (01/01/2015) 15% Mortgage debentures (01/01/2015) Equipment, at cost Accumulated depreciation: Equipment Inventory Accounts receivable Allowance for credit losses Prepaid expenses Bank Accrued expenses Land, at cost Profit and loss (profit after tax) 65 000 50 000 3 000 20 000 25 820 9 000 2 190 000 959 855 R2 449 820 R2 449 820 The following information must be taken into consideration: 1. An issue of 76 800 ordinary shares took place on 1 May 2015 at an issue price of R2.80 per share and has been correctly recorded. This was the only issue of shares during the current financial year. 2. On 1 January 2014 the company had issued 6 000 15% mortgage debentures of R100 each at a premium of 6%. The debentures are redeemable at par in ten years. Interest is payable annually on 31 December. No entries have been recorded relating to debentures or debenture interest at the end of the current financial year. Debentures and debenture interest for 2014 have been correctly accounted for. REQUIRED: (a) Prepare the Statement of Changes in Equity for Missy Limited for the 2015 financial year in compliance with International Financial Reporting Standards. (b) Prepare the note for Non-current liabilities the Statement of Financial Position for Missy Limited for the 2015 financial year in compliance with the Company's Act and IFRS. Note: Show all workings clearly. Work to the nearest R1. (RG102 : 23 minutes) Page 1 of 1 EXERCISE 8.12 8.12 Jungle Gym Limited was incorporated on 1 January 2008 with the following authorised capital: 100 000 Ordinary shares 50 000 Redeemable preference shares (dividend of 8c per share) On 31 July 2015 the following were the balances in the ledger of the company: DR CR R R Ordinary share capital (100 000 shares) 200 000 Share premium (ordinary shares) 25 000 Redeemable preference share capital (dividend of 8c per share) 49 647 Retained earnings (01/01/2015) 15 000 Accounts payable 12 000 Land, at cost 175 000 Machinery, at carrying amount 52 800 Preliminary expenses 15 000 Accounts receivable 44 300 Cash at bank 69 100 Profit and loss summary (profit) 54 553 R356 200 R356 200 The following occurred during the financial year ended 31 December 2015: 1. 50 000 Preference shares were issued on 1 January 2015 at R1 each and are redeemable on 1 January 2018 at R1.10 each. Interest on preference shares is payable half-yearly in arrears on 1 July and 1 January each year. The payment on 1 July 2015 was made, and correctly recorded in the accounting records of Jungle Gym Limited. 2. Share issue expenses of R1 250 were paid for the issue of preference shares and correctly accounted for in the accounting records of Jungle Gym Limited. During August 2015 the directors decided to convert the authorised and issued ordinary share capital to shares of no par value shares. The authorised capital was to be 200 000 shares of no par value. By 30 September 2015 the necessary formalities were completed and the old share certificates were cancelled and shareholders issued with new share certificates for no par value shares. On 1 October 2015 at a meeting of shareholders, the directors were given a general authority to issue the unissued shares before 31 March 2016. 3. On 30 October 2015 the company offered 50 000 ordinary shares at R2.50 each to the public. The issue was fully underwritten by Kidz Brokers for a commission of 4% of the issue price. The public applied for 40 000 shares and all application money including that from the underwriter was received by 1 December 2015. On the same date the company paid the underwriting commission. On 2 December 2015 the directors allotted the shares. REQUIRED: (a) Prepare the following notes to the Statement of Financial Position of Jungle Gym Limited at December 2015: 31 (0) (ii) Share capital Non-current liabilities (b) Prepare the Statement of Changes in Equity of Jungle Gym Limited for the year ended 31 December 2015 in terms of the Companies Act and IFRS. Note: Show all workings clearly. Work to the nearest R1. A worksheet is provided, which you may choose to use. If used, it should be handed in as part of your workings. (RV102: 32 minutes) Page 1 of 2 8.12 NAME: TRIAL BALANCE ADJUSTMENTS POST-ADJUSTMENT TRIAL BALANCE 31/07/2015 R R R R R R 200 000 Ordinary share capital (100 000 shares) Share premium (Ordinary shares) 25 000 49 647 15 000 Redeemable preference share capital (dividend of 8C per share) Retained earnings (01/01/2015) Accounts payable Land, at cost Machinery, at carrying amount 12 000 175 000 52 800 15 000 Preliminary expenses Accounts receivable Cash at bank Profit and loss summary (profit) 44 300 69 100 54 553 R356 200 R356 200 Page 2 of 2