SPECIAL LESSON QUESTIONS (16 SEPTEMBER 2017) 10 AM TO 12 NOON: 252/LT 2

Question 23: The balance sheet of XYZ Ltd showed the following as at 30th June 2017
Non-current assets 500 000
Current Assets: Bank 200 000
Total 700 000
Authorized Capital: 100 000 Ordinary shares of P10 each 1 000 000
Issued, called up and paid up capital : 60 000 Ordinary shares of P10 each 600 000
Share Premium 100 000
Total 700 000
On 1 July 2017, the company decided to issue 40 000 ordinary shares of P10 each at a premium
of P4 per share. The instalments were collected as under: P 2 on Application per share, P 7 on
Allotment (including premium) per share, P3 on First call per share P2 on Final call per share.
Applications were received for 70 000 ordinary shares and the company allotted shares as
follows: Application money for 20 000 shares were returned in full; the balance shares applied
for were allotted on a pro rata basis. All allotment monies were received in full. When the first
call was made, one shareholder holding 500 shares paid the final call money along with first call
money and another shareholder holding 1 000 shares did not pay the first call money. When the
final call was made all shareholders paid the final call money except the shareholder who did not
pay the first call money on 1000 shares also did not pay the final call money. On 1 September,
the 1 000 ordinary shares on which the First and Final calls were not paid were forfeited and later
reissued to Thomson at P9 per share who paid the full amount in one instalment. Required:
Prepare necessary ledger accounts to record the above transactions. Also show the extract of the
companys Balance sheet after all the above transactions have been completed.

Question 24: The balance sheet of KK Ltd showed the following figures on 31 March 2017
Non-current assets 380 000
Current Assets: Bank 150 000
Total 530 000
Authorized Capital: 80 000 Ordinary shares of P5 each 400 000
10 000 9% Preference shares of P10 each 100 000
Issued, called up and paid up capital : 60 000 Ordinary shares of P5 each 300 000
10 000 9% Preference shares of P10 each 100 000
Share Premium 50 000
Distributable profits 80 000
Total 530 000
On 1 April 2017 the company redeemed all the 10 000 preference shares at a premium of 5%.
These preference shares were originally issued at par. To raise partial funds, the company issued
10 000 ordinary shares of P5 each at par and the amount was received in full in one instalment.
On 1 July the company made a bonus share issue to existing ordinary shareholders at the rate of
2 (two) fully paid ordinary share for every 70 ordinary shares held by existing shareholders. The
company used the share premium amount for this purpose. Required: Prepare necessary ledger
accounts to record the above transactions. Also show the updated balance sheet after the above
transactions have been completed.