Question: Smith Ltd is issuing shares payable by installments. It completed the following transactions: February 2: Received an application for 5000 ordinary shares with a total

Smith Ltd is issuing shares payable by installments. It completed the following transactions:

February 2: Received an application for 5000 ordinary shares with a total issue price of $5 per share. The applicant paid one-quarter of the total issue price.

February 15: Allotted the 5000 shares and collected a further half of the total issue price.

June 1: Made a call on the shares and collected the balance still due.

Required:

Prepare the general journal entries to record the above transactions. (3 marks each for correct journal entry and amount). Also, prepare the shareholders equity as per the above. (3 marks if the amounts are correct)

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