Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Toiz-4-Boiz [T-4-B] is a manufacturer of electronic game hardware and game software. The company issued subscriptions for 250,000 no par value common shares at an
Toiz-4-Boiz [T-4-B] is a manufacturer of electronic game hardware and game software. The company issued subscriptions for 250,000 no par value common shares at an issue price of $24 per share on March 1, 2018. The issue terms called for a 20% payment on application, a second instalment of 25% payable two months later and the balance due on demand at the companys discretion. Similar shares were being traded at $28 on March 1. Let us continue with the information given above. The second instalment was called and all subscribers duly paid the amount due on May 1. Now in September, the company calls for the final instalment which would be due October 1. 1,500 subscribers failed to pay the amount due on the final instalment despite several reminders and consequently forfeited their subscriptions. The remaining subscribers, who were in good standing, paid the amounts due. Thereafter on November 1, T-4-B issues the common shares due to the remaining subscribers.
[20] The journal entry to record ONLY this share issue would be:
Select one:
a.
DR Common Share Subscribed $5,964,000;
CR Common Shares Capital $5,964,000
b.
DR Share Subscriptions Receivable $5,964,000;
CR Common Shares Capital $5,964,000
c.
DR Common Share Subscribed $7,000,000;
CR Common Shares Capital $7,000,000
d.
DR Share Subscriptions Receivable $4,800,000;
CR Common Shares Capital $4,800,000
e.
DR Common Share Subscribed $5,964,000;
CR Retained Earnings $5,964,000
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