February 8 As provided for in the constitution, the ordinary shares on which the call was unpaid were forfeited. The constitution in relation to this class of shares further provided for any surplus on resale, after satisfaction of unpaid calls and associated costs, to be returned to the former shareholders. 100,000 "A" ordinary shares, issued at $2, called to $1.80 $ 180,000 Less: Calls in Arrears - "A" ordinary shares $ (3,500) 120,000 "B" ordinary shares, issued at $1.50, called to $1 $ 120,000 250,000 5% preference shares, issued at $1, paid to $0.50 $ 125,000 100,000 $1 options $ 100,000 General reserve $ 250,000 Retained earnings $ 600,000 "A" ordinary shares - payable as follows: $0.80 on application $0.50 on allotment $0.50 on 1st call $0.20 on future calls "B" ordinary shares - payable as follows: $0.50 on application $0.50 on allotment $0.50 on future calls February 20 The forfeited shares were re-issued to Melbourne Investments Ltd, as paid to $1.80 per share for $1.40 cash per share. Share issue cost amounted to $500. February 21 The balance from forfeiture was returned to the former shareholders. Required: ? Prepare the general journal entries to record the above independent scenarios. ? Narrations to general journal entries must be provided. (Note that narrations are not required in the examination). ?

detailed workings/calculations must be shown. ? Absence of workings/calculations may lead to zero marks allocated to the particular general journal entry, despite the fact that the entry might be correc

Scenario 4 February 8 As provided for in the constitution, the ordinary shares on which the call was unpaid were forfeited. The constitution in relation to this class of shares further provided for any surplus on resale, after satisfaction of unpaid calls and associated costs, to be returned to the former shareholders. 100,000 "A" ordinary shares, issued at $2, called to $1.80 $ 180,000 Less: Calls in Arrears - "A" ordinary shares (3,500) 120,000 "B" ordinary shares, issued at $1.50, called to $1 $ 120,000 250,000 5% preference shares, issued at $1, paid to $0.50 $ 125,000 100,000 $1 options $ 100,000 General reserve $ 250,000 Retained earnings $ 600,000 "A" ordinary shares - payable as follows: $0.80 on application $0.50 on allotment $0.50 on 1s call $0.20 on future calls "B" ordinary shares - payable as follows: $0.50 on application $0.50 on allotment $0.50 on future calls February 20 The forfeited shares were re-issued to Melbourne Investments Lid, as paid to $1.80 per share for $1.40 cash per share. Share issue cost amounted to $500. February 21 The balance from forfeiture was returned to the former shareholders