Loki Limited has the following equity accounts on January 1, 2021: Share Capital-Ordinary (5 par, 150,000...

 

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Loki Limited has the following equity accounts on January 1, 2021: Share Capital-Ordinary (€5 par, 150,000 shares issued) €750,000 Share Premium-Ordinary €250,000 Retained Earnings €120,000. In 2021, the company had the following equity related transactions. • March: Issued 15,000 ordinary shares at a price of €15. ● May: The board of directors announced a share dividend equal to €0.50 per share. • June: The dividend is paid • August: The company repurchases 12,000 shares at €10 per share. • September: Sold 6,000 shares at €13 per share. • October: Sold 6,000 shares at €6 per share. Loki uses the cost method of accounting for treasury shares. In 2021, the company reported net income of €40,000. Instructions a. Journalize the transactions, and prepare the closing entries as of December 31, 2021, for net income and cash dividends. b. Open T-accounts for (1) Share Capital - Ordinary; (2) Share Premium - Ordinary; (3) Treasury Shares; (4) Share Premium-Treasury, (5) Retained Earnings. Post to these accounts (without using a posting reference). c. Prepare the equity section for Loki Limited Limited as of December 31, 2021. Loki Limited has the following equity accounts on January 1, 2021: Share Capital-Ordinary (€5 par, 150,000 shares issued) €750,000 Share Premium-Ordinary €250,000 Retained Earnings €120,000. In 2021, the company had the following equity related transactions. • March: Issued 15,000 ordinary shares at a price of €15. ● May: The board of directors announced a share dividend equal to €0.50 per share. • June: The dividend is paid • August: The company repurchases 12,000 shares at €10 per share. • September: Sold 6,000 shares at €13 per share. • October: Sold 6,000 shares at €6 per share. Loki uses the cost method of accounting for treasury shares. In 2021, the company reported net income of €40,000. Instructions a. Journalize the transactions, and prepare the closing entries as of December 31, 2021, for net income and cash dividends. b. Open T-accounts for (1) Share Capital - Ordinary; (2) Share Premium - Ordinary; (3) Treasury Shares; (4) Share Premium-Treasury, (5) Retained Earnings. Post to these accounts (without using a posting reference). c. Prepare the equity section for Loki Limited Limited as of December 31, 2021.

Answer rating: 100% (QA)

a Journal Entries b TAccounts C Date March May June Aug... View the full answer