tion 2.12 Oversubscription with pro rata allotment, and forfeiture ,3,4 10 On 1 July 2017, Gum Ltd was registered and offered 1 000 000 ordinary shares to the public at an issue price of $6, payable as follows: $3 on application (due 15 August) $2 on allotment (due 15 September) $1 on final call The issue was underwritten at a commission of $8000. By 15 August, applications had been received for 1 200 000 ordinary shares of which applicants for 200 000 shares forwarded the full $6 per share, the remainder paying only the application money. At a directors' meeting on 16 August, it was decided to allot shares in full to applicants who had paid the full amount and proportionally to all remaining applicants. According to the company's con- stitution, all surplus money from application can be transferred to Allotment and/or Call accounts. The underwriting commission was paid on 28 August. Other share issue costs of $6000 were also paid on this date. All outstanding allotment money was received by the due date. The final call was made on 1 November with money due by 30 November. All money was received on the due date except for the holder of 30 000 shares who failed to meet the final call. On 7 December, as provided for in the constitution, the directors decided to forfeit these shares. They were reissued, on 15 December, as paid to $6 for $5.60 cash. The balance of the Forfeited Shares account was returned to the former shareholder on 16 December CTIVITY SECTION Prepare the journal entries of record the transactions of Gum Lid up to and including that which took place on 16 December 2017. (Show all workings.) Question 2.6 Rights issues and private placements LO 4,6 100 The equity of Ash Ltd on 30 June 2017 was: Share capital (issued at $4, fully paid) $1200000 Asset revaluation surplus 700 000 Retained earnings 400 000 The following transactions occurred during the year ended 30 June 2018. 1. On 1 August 2017, a l-for-4 rights offer was made to existing shareholders. The issue price was $4 per share payable in full on allotment, and rights were transferable. Shares issued under the offer were to rank equally with existing shares as from 1 August 2017. The issue ompany Accounting Tenth Edition At a directors' meeting on 7 November, it was decided to allot shares in full to applicants who had paid either the $12 or $9 on application, to reject applications for 20 000 shares and to pro- portionally allocate shares to all remaining applicants. According to the company's constitution, all surplus money from application can be transferred to Allotment and/or Call accounts. Share issue costs of $11 000 were also paid on 7 November. All outstanding allotment money was received by the due date. A first call for $1.60 was made on 1 February 2019 with money due by 1 March. All money was received by the due date. A second and final call for $1.40 was made on 1 June with money due by 18 June. All money was received by the due date. Required Prepare the journal entries to record these transactions of Prunus Ltd. (Show all workings.) STUDENT AC