QUESTION2SHARE RIGHTS ISSUE6 MARKS Pyke Franchises Ltd equity section of its Balance Sheet as at 30 th June 20X5 presents as follows EQUITY$ 000s Share Capital Ordinary shares paid to $5 0048,000 8 $10 00 Preference shares 12,000 Reserves Foreign exchange translation2,564 Asset revaluation surplus4,560 Retained Profits 6,732 TOTAL EQUITY 73,856 The Preference shares are non participating Share issue costs of $2,000,000 have been offset against the Ordinary share capital The company wishes to raise further capital and decides to offer existing Ordinary shareholders with the opportunity to invest further in the company As a result a renounceable Rights issue is made to those shareholders of 1 share for every 10 held at an exercise price of $5 00 share payable in full at the exercise date of 31 st October 20X5 There are no costs associated with this Rights issue As at 31 st October 20X5 the required money had been received from 85 of shareholders The remaining shareholders decided not to take up the offer REQUIRED Prepare general journal entry s with narrations to record the transactions resulting from the Rights issue Show any calculations you consider relevant QUESTION3FORFEITURE AND REISSUE OF SHARES12 MARKS Scottie Golf Ltd is an unlisted company and has been operating for a number of years At the beginning of the 20X8 X9 financial year it decided to raise further capital from the public As a result it issued a prospectus for 2,000,000 shares at $5 00 share The offer was oversubscribed and all 2,000,000 shares were issued A First Call was made on the shares on 1 st January 20X9 The general ledger T accounts below provide the details of the issue and the call Share Capital 1 7 X8Bal b d 8,700,000 1 10 X8Applications 4,000,000 Allotment 2,000,000 1 1 X9First Call 2,000,000 Calls in Advance 1 1 X9First Call 500,000 1 10 X8Applications 1,000,000 FirstCall 1 1 X9Share Capital 2,000,000 1 1 X9Calls in Advance 500,000 28 2 X9Cash at Bank 1,461,830 On 1 st March 20X9 the decision was made to forfeit the shares of those shareholders who did not pay the Call Those shares were offered to another single shareholder at price of $3 80 share but paid to $4 00 share with that shareholder having to pay any future calls The single shareholder paid the amount due on 15 th March 20X9 and the costs associated with the forfeiture and re issue were $5,700 The forfeited shareholders received refunds of the remaining amounts on 31 st March 20X9 REQUIRED Prepare general journal entries with narrations to record all the transactions dealing with the share forfeiture, subsequent share reissue and payment to forfeited shareholders QUESTION4DIVIDENDS16 MARKS JDay Retailing Ltd is an unlisted company and has been very successful in recent years The company now has a solid history of paying dividends to its shareholders A number of years ago it also introduced a Dividend Reinvestment Plan (DRP) for its shareholders 60 of the shareholders now utilise the DRP for the receipt of their dividends and the remaining shareholders receive cash All shares are issued at $2 00 share The following are a series of events relating to dividends for Ordinary shareholders of the company 15 6 20X4Determined the final dividend for the year of $0 08 share to be paid from profits 30 9 20X4AGM approves the final dividend of $0 08 share and is paid on this date 15 1 20X5Paid a special dividend of $0 05 share out of a general reserve 15 3 20X5Declared and paid an interim dividend of $0 09 share out of profits 20 6 20X5Determined the final dividend for the year of $0 10 share to be paid out of profits 30 9 20X5AGM approves the final dividend of $0 11 share and is paid on this date The Register of Shareholders shows the following number of Ordinary shares issued at particular dates 15 6 20X412,500,000 30 9 20X412,500,000 15 1 20X514,000,000 15 3 20X514,210,000 20 6 20X514,593,670 30 9 20X514,593,670 REQUIRED Prepare general journal entries with narrations to record all the transactions dealing with all dividends which occurred in the 20X4 X5 financial year only Round numbers to the nearest dollar where applicable

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QUESTION2SHARE RIGHTS ISSUE6 MARKS Pyke Franchises Ltd equity section of its Balance Sheet as at 30 th June 20X5 presents as follows  EQUITY$ 000s Share Capital Ordinary shares paid to $5 0048,000 8  $10 00 Preference shares 12,000 Reserves Foreign exchange translation2,564 Asset revaluation surplus4,560 Retained Profits 6,732 TOTAL EQUITY 73,856 The Preference shares are non participating Share issue costs of $2,000,000 have been offset against the Ordinary share capital  The company wishes to raise further capital and decides to offer existing Ordinary shareholders with the opportunity to invest further in the company As a result a renounceable Rights issue is made to those shareholders of 1 share for every 10 held at an exercise price of $5 00 share payable in full at the exercise date of 31 st October 20X5 There are no costs associated with this Rights issue  As at 31 st October 20X5 the required money had been received from 85  of shareholders The remaining shareholders decided not to take up the offer  REQUIRED Prepare general journal entry s with narrations to record the transactions resulting from the Rights issue Show any calculations you consider relevant  QUESTION3FORFEITURE AND REISSUE OF SHARES12 MARKS Scottie Golf Ltd is an unlisted company and has been operating for a number of years At the beginning of the 20X8 X9 financial year it decided to raise further capital from the public As a result it issued a prospectus for 2,000,000 shares at $5 00 share The offer was oversubscribed and all 2,000,000 shares were issued A First Call was made on the shares on 1 st January 20X9 The general ledger T accounts below provide the details of the issue and the call  Share Capital 1 7 X8Bal b d 8,700,000 1 10 X8Applications 4,000,000 Allotment 2,000,000 1 1 X9First Call 2,000,000 Calls in Advance 1 1 X9First Call 500,000 1 10 X8Applications 1,000,000 FirstCall 1 1 X9Share Capital 2,000,000 1 1 X9Calls in Advance 500,000 28 2 X9Cash at Bank 1,461,830 On 1 st March 20X9 the decision was made to forfeit the shares of those shareholders who did not pay the Call Those shares were offered to another single shareholder at price of $3 80 share but paid to $4 00 share with that shareholder having to pay any future calls The single shareholder paid the amount due on 15 th March 20X9 and the costs associated with the forfeiture and re issue were $5,700 The forfeited shareholders received refunds of the remaining amounts on 31 st March 20X9  REQUIRED Prepare general journal entries with narrations to record all the transactions dealing with the share forfeiture, subsequent share reissue and payment to forfeited shareholders  QUESTION4DIVIDENDS16 MARKS JDay Retailing Ltd is an unlisted company and has been very successful in recent years The company now has a solid history of paying dividends to its shareholders A number of years ago it also introduced a Dividend Reinvestment Plan (DRP) for its shareholders 60  of the shareholders now utilise the DRP for the receipt of their dividends and the remaining shareholders receive cash All shares are issued at $2 00 share  The following are a series of events relating to dividends for Ordinary shareholders of the company  15 6 20X4Determined the final dividend for the year of $0 08 share to be paid from profits  30 9 20X4AGM approves the final dividend of $0 08 share and is paid on this date  15 1 20X5Paid a special dividend of $0 05 share out of a general reserve  15 3 20X5Declared and paid an interim dividend of $0 09 share out of profits  20 6 20X5Determined the final dividend for the year of $0 10 share to be paid out of profits  30 9 20X5AGM approves the final dividend of $0 11 share and is paid on this date  The Register of Shareholders shows the following number of Ordinary shares issued at particular dates  15 6 20X412,500,000 30 9 20X412,500,000 15 1 20X514,000,000 15 3 20X514,210,000 20 6 20X514,593,670 30 9 20X514,593,670 REQUIRED Prepare general journal entries with narrations to record all the transactions dealing with all dividends which occurred in the 20X4 X5 financial year only  Round numbers to the nearest dollar where applicable

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QUESTION2SHARE RIGHTS ISSUE6 MARKS Pyke Franchises Ltd equity section of its Balance Sheet as at 30 th June 20X5 presents as follows: EQUITY$ 000s Share

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