In: Accounting
La Sfera Co. was formed on July 1, 2014. The company reported the following summarized statement of financial position at July 1, 2017:
RM |
|
Assets |
|
Cash |
472,000 |
Other assets |
1,680,000 |
Total assets |
2,152,000 |
Liabilities and Equity |
|
Liabilities |
|
Other liabilities |
546,000 |
Ordinary dividend payable |
35,000 |
Shareholders’ equity |
|
7% preference shares, 300,000 authorised, 50,000 issued |
250,000 |
Ordinary share, 500,000 authorised, 250,000 issued |
750,000 |
Retained earnings |
571,000 |
Total liabilities and equity |
2,152,000 |
The following transactions occurred during the financial year but have not been recorded:
July 1, 2016 |
Paid dividends payable to shareholders. |
Aug 15, 2016 |
Issued 50,000 ordinary shares to the public for RM5 per share. The company incurred RM4, 000 on the costs of issuance of shares. |
Nov 23, 2016 |
Offered right issue to existing shareholders, with the right to purchase one shares for every 80 shares held. Market price on the date was RM5. All offers were taken up. |
Feb 1, 2017 |
Obtained a 6-month loan amounting RM 25,000 from JuneBank at 4% per year to expand the business. |
Mar 7, 2017 |
Declared and distributed one-for-fifty share dividend to shareholders on record. Market value per share was RM6. The company used its retained earnings for the purpose of giving bonus share. |
May 18, 2017 |
Declared cash dividend to ordinary shareholders of RM0.20 per share, subject to approval at the forthcoming annual general meeting. |
June 1, 2017 |
Issued 10% three-year bonds payable with a RM150, 000 par value at the price of RM133, 540. The current market interest rate is 12%. |
June 30, 2017 |
Payment of cash dividend to ordinary shareholders has been approved. The money will be credited to ordinary shareholders in July 15, 2018. |
Paid preference dividend. |
Required:
Journalise the above transactions.
Prepare the statement of financial position as at December 31, 2017.
PArt 1
Date | Particulars | Debit (RM) | Credit (RM) |
1-Jul | Dividend Payable | 35000.00 | |
Cash | 35000.00 | ||
(dividend payable paid) | |||
15-Aug | Cash | 250000.00 | |
Share Capital | 150000.00 | ||
Premium on Share Capital | 100000.00 | ||
(share capital issued at premium with $3 per share par value) | |||
15-Aug | Share Issue Expenses | 4000.00 | |
Cash | 4000.00 | ||
(share issue expenses) | |||
23-Nov | Cash | 18750.00 | |
Share Capital | 11250.00 | ||
Premium on Share Capital | 7500.00 | ||
(right share issued) | |||
1-Feb | Cash | 25000.00 | |
Loan | 25000.00 | ||
(loan received recorded) | |||
7-Mar | Retained Earning | 36450.00 | |
Common Stock Dividend Payable | 18225.00 | ||
Premium on Share Capital | 18225.00 | ||
(stock dividend issued with share value deemed to be RM 3) | |||
18-May | Retained Earnings | 60750.00 | |
Dividend Payable | 60750.00 | ||
(dividend declared recorded) | |||
1-Jun | Cash | 133540.00 | |
10% Bonds Payable | 133540.00 | ||
(bonds payable issue recorded) | |||
15-Jul | Dividend Payable | 60750.00 | |
Cash | 60750.00 | ||
PART 2
Particulars | Amount |
Assets | RM |
Cash | 799,540 |
Other assets | 1,680,000 |
Total assets | 2,479,540 |
Liabilities and Equity | |
Liabilities | |
Other liabilities | 571,000 |
10% Bonds Payable | 133,540 |
Shareholders’ equity | |
7% preference shares, 300,000 authorised, 50,000 issued | 250,000 |
Ordinary share, 500,000 authorised, 250,000 issued | 929,475 |
Share Premium | 125725 |
Retained earnings | 469,800 |
Total liabilities and equity | 2,479,540 |