Question: Question 1 (12 marks) TK Ltd issues a prospectus inviting the public to subscribe for 30 million ordinary shares of $2.00 each. The terms of

Question 1 (12 marks) TK Ltd issues a prospectus inviting the public to subscribe for 30 million ordinary shares of $2.00 each. The terms of the issue are that $1.00 is to be paid on application and the remaining $1.00 within one month of allotment. Applications are received for 36 million shares during July 2015. The directors allot 30 million shares on 15 August 2015. All applicants receive shares on a pro rata basis. The amounts payable on allotment are due by 20 September 2015. By 20 September 2015 the holders of 6 million shares have failed to pay the amounts due on allotment. The directors forfeit the shares on 30 September 2015. The shares are resold on 15 October 2015 as fully paid. An amount of $1.70 per share is received. Required: Provide the journal entries necessary to account for the above transactions and events

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