KK Limited was formed with authorized capital of shs 600,000 divided into 2,000 shares of shs 300 each. The company decided to issue 1,000 shares to the public for subscription payable in the following installments;

Application shs 150 per share (including premium)

Allotment shs 100 per share

1^st & final call shs 100 per share

Since funds required for the company activities were substantial, it also issued 300 6% debentures at shs 500 each. The debentures were issued payable as follows;

Application shs 200

Allotment shs 300 (including premium)

1^st & final call shs 50

The shares were oversubscribed by 500 shares and it was decided to refund application money for 300 shares, while allotment was made for the remaining applicants pro-rata. All the allotment money and calls money were received in full.

For debentures, applicants were received for 400 debentures and money for 50 debentures was refunded. The remaining applicants were scaled down and allotment was made to applicants on pro-rata.

Required:

a.Open up and post into necessary ledger accounts the above transactions. (20 marks)

b. extract of the Statement of Financial Position for KK Ltd. (5 marks)