QUESTION 2: COMPANY EQUITY, SPECIAL REPORTING ISSUES AND EPS Question 2 consists of three separate parts, Part 1, Part 2 and Part 3. All parts are compulsory Part 1 Kelly Ltd undertook an issue of ordinary and preference shares in April 2018 as stated by the following transactions: 2018 1 April A prospectus was issued inviting applications for 100,000 ordinary shares at an issue price of $1.50, fully payable on application. The prospectus also offered 100,000 10% preference shares at an issue price of $2, fully payable on application. The issue was underwritten at a commission of $4,500, being $500 relating to the issue of ordinary shares and the balance for preference shares. All unsuccessful application monies were to be returned to the applicants Applications closed with the ordinary issue oversubscribed by 40,000 shares and the preference shares undersubscribed by 15,000 shares 100,000 ordinary shares were allotted, applications for 40,000 shares were rejected, and money refunded. 100,000 preference shares were also allotted The underwriter paid for the shares allocated to her, less the commission due 10 April: 15 April: 20 April: Required: (10 marks) Prepare journal entries to record the above transactions for Kelly Ltd Part 2