Jhavid and Jones traded as a partnership J&J trading Store. On 1 July 2021, they agreed to form a company Safari Ltd to take over the partnership as a going concern. The purchase consideration, paid to each partner:

150000 shares @ $1.50

$150,000 cash

Details of the assets and liabilities taken over were as follows:

 

Asset	Book Value ($)	Fair Value ($)
Accounts Receivable	100,000	95,750
Accounts Payable	50,000	50,000
Mortgage (Land & Building)	80,000	$80,000
Bank	120,000	120,000
Inventory	90,000	87,000
Land and Building	300,000	325,000
Motor Vehicle	60,000	55,000
Plant and Equipment	90,000	87,000

Formation costs amounted to $2,000.

On 1 January 2022 the company issued a prospectus inviting applications for the issue of 2,000,000 $2.50 ordinary shares.

The terms per share were:

 $1.25 payable on application.

$1.00 payable on allotment.

$0.25 payable on call

 

The prospectus allowed for any excess moneys on application to be applied towards allotment and calls moneys due. The issue was oversubscribed when applications closed on 28 February 2022. On 15 March, the allotment of shares occurred as follows:

 

 

Shares Applied for	Shares Allotted	Amount Received	Application $1.25	Allotment $1.00	Calls $0.25	Refund
950,000	950,000	$2,375,000
600,000	600,000	$1,375,000
550,000	450,000	$687,500
100,000	0	$125,000
2,200,000	2,000,000	$4,562,500.00

The balance of the allotment money was received by 31 March. In April, company called the selected shareholders to pay their remaining money. All call money was received by 30th April 2022.

Share issue cost was $2,500

Required:

(a) General Journal entries to record the above transactions (Business Conversion and Share Issue)

(b) Post the above transactions to the General Ledger.

(c) Extract a Trial Balance as at 30th April 2022?

(d) Produce a Balance Sheet for Safari Ltd as at 30th April 2022?