HA2032 - Corporate & Financial Accounting - Accounting and Finance Assignment Help

Assignment Task

Task:

Question 1 (7 marks)
 

ABC Ltd was registered on 30 June 2019. The next day, the directors issued a prospectus inviting applicants for 400000 ordinary shares with an issue price of $2. The shares were payable in full on application. By 31 July, the company had received 500000 applications, together with the application monies. The directors allotted 400000 shares on 1 August and returned the money for additional applications.
 

Required:
(a) Prepare general journal entries to record the above data. (3.5 marks)
(b) Enter the above data into ledgers. (3.5 marks)

Question 2 (7 marks)

(a) What are the most common reasons for a corporation to reduce share capital? (2 marks)
(b) What are the allowable methods of reducing share capital? (2 marks)
(c) Discuss the differences between share buyback and capital reduction. (2 marks)
(d) What are the different types of debts instruments discussed in your text book? (1 mark)

Question 3 (7 marks)

(a) Explain the ways in which a company may expand by obtaining new assets. (1 mark)
(b) Jamuna River Ltd purchased a parcel of assets and liabilities comprising a business directly from Lyneham Pty Ltd. The parcel, measured at net fair values, consisted of:

Balance of Accounts:
Plant 150,000
Land 240,000
Vehicles 120,000
Accounts receivable 30,000
Accounts payable (48000)
Total 492000

Required:

Prepare journal entries to record the acquisition by Jamuna River Ltd, assuming that:

(i) The cost of acquisition was $600,000 cash. (3 marks)
(ii)The cost of acquisition was $432,000 cash.

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