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Note: (a) There were contingency liabilities of RM13,560. (b) The preference share dividends were 2 years in arrears. The following scheme of capital reduction was agreed upon: (a) It was decided to call the uncalled ordinary shares of RM0.20 each for cash (b) The preference shareholders agreed to accept 180,000 ordinary shares o RM1 each, for settlement on the dividends in arrears. (c) Accumulated loss and intangible assets were to be written-off. (d) The fair value of assets were as follows: Furniture and fittings Property Plant RM204,120 RM2,251,300 RM211,000 (e) The loan from directors was to be settled by ordinary shares at 40% on the total amount owed. (f) 400,000 ordinary shares were to be issued to the public for cash. You are required to prepare the following: (a) Journal entries to record the above information (b) Statement of financial position immediately after the organization

Note: (a) There were contingency liabilities of RM13,560. (b) The preference share dividends were 2 years in arrears. The following scheme of capital reduction was agreed upon: (a) It was decided to call the uncalled ordinary shares of RM0.20 each for cash (b) The preference shareholders agreed to accept 180,000 ordinary shares o RM1 each, for settlement on the dividends in arrears. (c) Accumulated loss and intangible assets were to be written-off. (d) The fair value of assets were as follows: Furniture and fittings Property Plant RM204,120 RM2,251,300 RM211,000 (e) The loan from directors was to be settled by ordinary shares at 40% on the total amount owed. (f) 400,000 ordinary shares were to be issued to the public for cash. You are required to prepare the following: (a) Journal entries to record the above information (b) Statement of financial position immediately after the organization

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Note: (a) There were contingency liabilities of RM13,560. (b) The preference share dividends were 2 years in arrears. The following scheme of capital reduction was agreed upon: (a) It was decided to call the uncalled ordinary shares of RM0.20 each for cash (b) The preference shareholders agreed to accept 180,000 ordinary shares o RM1 each, for settlement on the dividends in arrears. (c) Accumulated loss and intangible assets were to be written-off. (d) The fair value of assets were as follows: Furniture and fittings Property Plant RM204,120 RM2,251,300 RM211,000 (e) The loan from directors was to be settled by ordinary shares at 40% on the total amount owed. (f) 400,000 ordinary shares were to be issued to the public for cash. You are required to prepare the following: (a) Journal entries to record the above information (b) Statement of financial position immediately after the organization
Transcribed Image Text:Note: (a) There were contingency liabilities of RM13,560. (b) The preference share dividends were 2 years in arrears. The following scheme of capital reduction was agreed upon: (a) It was decided to call the uncalled ordinary shares of RM0.20 each for cash (b) The preference shareholders agreed to accept 180,000 ordinary shares o RM1 each, for settlement on the dividends in arrears. (c) Accumulated loss and intangible assets were to be written-off. (d) The fair value of assets were as follows: Furniture and fittings Property Plant RM204,120 RM2,251,300 RM211,000 (e) The loan from directors was to be settled by ordinary shares at 40% on the total amount owed. (f) 400,000 ordinary shares were to be issued to the public for cash. You are required to prepare the following: (a) Journal entries to record the above information (b) Statement of financial position immediately after the organization
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