Part B Company Transactions 9 Marks Stationery City Ltd has supplied you with the following details for the year ended 30 June 2013. Stationery City Ltd Statement of Financial Position (Balance Sheet) as at 1 July 2012 (Extract) Equity Contributed Equity (400,000 fully paid shares) Retained Earnings Land Revaluation Surplus $ 800,000 420,000 185,000 Additional Information: 1. The Directors paid a final dividend of 8 cents per share on 25 September 2012. 2. On 20 October 2012 the public were offered a further 100.000 shares at a fair value of $2.50. A brokerage fee of 1.0% was paid. 3. On 10 December 2012 the company repurchased 15.000 at a fair value of $3.00 per share. 4. On 10 January 2013 an interim dividend of 5 cents per share was paid to all current shareholders. 5. On 20 June 2013 the land was revalued from $650,000 to $780,000. 6. On 30 June 2013 the company issued bonus shares in the ratio of 1 for every 5 held at a price of $3.00 per share with the funds to come out of the land revaluation surplus. 7. The profit before taxation was $375,000. Provisional tax payments of $95.000 had been made during the year. The taxation expense is calculated at 28% of profit before tax. Required: a) Prepare the General Journal entry to record (1) the issue of shares to the public on 20 October 2012. (2) share repurchase on 10 December 2012 (3) the bonus issue of shares on 30 June 2013 (4) the income tax expense on 30 June 2013 b) Calculate the closing balance of the Land Revaluation Surplus and Prepare the Retained Earnings ledger account. You do not need to balance the account at the end of the year. Stationery City Ltd General Journal Date Particulars Debit Credit Stationery City Ltd Retained Earnings 2012 Jul 1 Balance 420,000