Question 1 Company Financing

On 16 March 2019, Caligula Ltd was incorporated and a prospectus was issued inviting applications for 90,000 shares at an issue price of $5, payable as follows:

$2.5 on application

$1.5 on allotment

$1 on final call

By 16 May 2019, applications had been received for 96,000 ordinary shares of which applicants for 30,000 shares forwarded the full $5 per share, the remainder 66,000 shares paying only the application money.

On 1 June 2019, the directors decided allot shares in full to applicants who had paid the full amount and proportionally to all remaining applicants. In accordance with the prospectus, all surplus money on application can be transferred to the Allotment and Call accounts. The issue was underwritten at a commission of $5,500 which was paid on 1 June 2019. All outstanding allotment money was received by 30 June 2019.

The final call was made on 11 November 2019 with money due by 30 November 2019. All outstanding call monies except a parcel of 5,000 shares were received by 30 November 2019. On 1 December 2019, the directors decided to forfeit the 5,000 shares. On 5 December 2019, the forfeited shares were reissued as fully paid ordinary shares for a consideration of $4.80 per share. Costs of forfeiture and reissue amounted to $700. The balance related to forfeited shares was refunded to the former shareholders on 30 December 2019.

Required:

Prepare journal entries to record all of the above events from the 16 March 2019 to 30 December 2019. Descriptions/Narrations are NOT required.