The equity section of the balance sheet of Plenti Ltd as at 31 December 2023 was as follows:

Additional information:
(i) The ordinary shares have a par (or ‘nominal’) value of 25 pence each.
(ii) The preference shares have a par (‘or nominal’) value of £2 each.
(iii) All the share capital that has been issued has been both called up and paid in full.
Required:

(a) How many ordinary shares are in issue?

(b) How many preference shares are in issue?

(c) Are the preference shares redeemable or irredeemable? How do you know?

(d) If the preference dividend for the year ended 31 December 2024 is paid in two equal instalments, what payments will be made in respect of each share and what will be the total preference dividends paid by the company?

(e) If the company makes a profit for the year ended 31 December 2024 of £104,000 and pays total dividends (ordinary and preference) of £51,400 during the year ended 31 December 2024, what will be the balance of retained earnings in the balance sheet as at 31 December 2024?

(f) Now suppose that the preference shares are cumulative and that no preference dividends were paid for either of the years ending 31 December 2022 or 2023. The directors wish to pay an ordinary dividend of 9 pence per share for the year ended 31 December 2024. To achieve this, what total dividends must be paid by the company?
(g) If the company issues a further 150,000 ordinary shares for cash at an issue price of 95 pence per share, what double entry would be required to record the issue?

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Ordinary share capital 6% preference share capital Share premium Retained earnings Total equity 175,000 40,000 98,000 364,000 677,000