Question One Aberdeen Ltd is listed on the Australian Securities Exchange. The directors of Aberdeen Ltd announced a public offer of shares. Following is a list of transactions summarising the public offer of shares: • On 1 September 2021, Aberdeen Ltd receives application money of $800 000 from investors wanting to acquire shares of the company. • On 14 September 2021, the company allots 2 million shares for a price of $1.00 as partly paid to $0.40 per share. On the same day, the call for the balance of the share price of $0.60 is made by the company. The call money is due in one month. • On 1 October 2021, the holders of 1 800 000 shares have made the payment that is due on the call. • On 10 October 2021, the directors of Aberdeen Ltd decide to forfeit the remaining 200 000 shares where the application money was paid but the applicants failed to pay the call. • On 15 October 2021, the forfeited shares are reissued as fully paid and sold in an auction. Aberdeen Ltd receives $0.80 per share. The costs of conducting the sale were $2 000. • On 25 October 2021, the balance of forfeited shares account paid the applicants paid the application but failed to pay the call. REQUIRED Prepare all journal entries necessary to account for the issue of the shares. In your answer narratives for journal entries are not necessary but you must include the date of the journal entry as included in the question.
Question One Aberdeen Ltd is listed on the Australian Securities Exchange. The directors of Aberdeen Ltd announced a public offer of shares. Following is a list of transactions summarising the public offer of shares: • On 1 September 2021, Aberdeen Ltd receives application money of $800 000 from investors wanting to acquire shares of the company. • On 14 September 2021, the company allots 2 million shares for a price of $1.00 as partly paid to $0.40 per share. On the same day, the call for the balance of the share price of $0.60 is made by the company. The call money is due in one month. • On 1 October 2021, the holders of 1 800 000 shares have made the payment that is due on the call. • On 10 October 2021, the directors of Aberdeen Ltd decide to forfeit the remaining 200 000 shares where the application money was paid but the applicants failed to pay the call. • On 15 October 2021, the forfeited shares are reissued as fully paid and sold in an auction. Aberdeen Ltd receives $0.80 per share. The costs of conducting the sale were $2 000. • On 25 October 2021, the balance of forfeited shares account paid the applicants paid the application but failed to pay the call. REQUIRED Prepare all journal entries necessary to account for the issue of the shares. In your answer narratives for journal entries are not necessary but you must include the date of the journal entry as included in the question.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Question One
Aberdeen Ltd is listed on the Australian Securities Exchange. The directors of Aberdeen Ltd
announced a public offer of shares. Following is a list of transactions summarising the public
offer of shares:
• On 1 September 2021, Aberdeen Ltd receives application money of $800 000 from
investors wanting to acquire shares of the company.
• On 14 September 2021, the company allots 2 million shares for a price of $1.00 as partly
paid to $0.40 per share. On the same day, the call for the balance of the share price of
$0.60 is made by the company. The call money is due in one month.
• On 1 October 2021, the holders of 1 800 000 shares have made the payment that is due
on the call.
• On 10 October 2021, the directors of Aberdeen Ltd decide to forfeit the remaining 200 000
shares where the application money was paid but the applicants failed to pay the call.
• On 15 October 2021, the forfeited shares are reissued as fully paid and sold in an auction.
Aberdeen Ltd receives $0.80 per share. The costs of conducting the sale were $2 000.
• On 25 October 2021, the balance of forfeited shares account paid the applicants paid the
application but failed to pay the call.
REQUIRED
Prepare all journal entries necessary to account for the issue of the shares. In your answer
narratives for journal entries are not necessary but you must include the date of the
journal entry as included in the question.
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