Question
On 1 July 2018, XYZ Ltd issued a prospectus inviting applications for 100000 ordinary shares, at an issue price of $5, payable $4 on application
On 1 July 2018, XYZ Ltd issued a prospectus inviting applications for 100000 ordinary shares, at an issue price of $5, payable $4 on application and $1 on future call(s), dates to be determined by the directors. By 1 September, applications were received for 110000 shares with $4 paid per share. On 6 September, the directors allotted 100000 shares proportionally to all the applicants. Application fees on the remaining 20 000 shares were retained as an advance on future calls as some shareholders received fewer shares than they had applied for. Share issue costs of $2 000 were also paid on the same date. On 1 February 2019, a first and final call for $1 was made. All of the call money was received by 1 March 2019.
Required
Prepare journal entries to record the above transactions.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started