Issue of shares JB Milks Ltd invited applications for 300,000 5% Preference shares of $1 cach...

  

Transcribed Image Text:

Issue of shares JB Milks Ltd invited applications for 300,000 5% Preference shares of $1 cach at $1.40, payable: 40% on application, 80% on allotment (including premium) 20% on first and final call All the allotment money was received but a holder of 10,000 shares failed to meet the call and forfeited his shares in accordance with the articles of the company. All forfeited shares were subsequently re-issuecd as fully paid shares at 80 cents cach. Required: A. i. ii. Prepare the following Accounts: Application & Allotment Account Preference Share Capital Account Share Premium Account iii. iv. Bank Account First & Final Call Account v. vi. vii. Investment: Own Share Account B. Explain the following terms: i. Forfeiture ii. Redemption of shares iii. Earnings per Share Issue of shares JB Milks Ltd invited applications for 300,000 5% Preference shares of $1 cach at $1.40, payable: 40% on application, 80% on allotment (including premium) 20% on first and final call All the allotment money was received but a holder of 10,000 shares failed to meet the call and forfeited his shares in accordance with the articles of the company. All forfeited shares were subsequently re-issuecd as fully paid shares at 80 cents cach. Required: A. i. ii. Prepare the following Accounts: Application & Allotment Account Preference Share Capital Account Share Premium Account iii. iv. Bank Account First & Final Call Account v. vi. vii. Investment: Own Share Account B. Explain the following terms: i. Forfeiture ii. Redemption of shares iii. Earnings per Share

Answer rating: 100% (QA)

Solution to the above problem is given in the following images Ans A Ans B Explain following ite... View the full answer