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Ramat... M Gmail Yo 100% Times New 11.9 + BI U A 2 3 5 6 17 18 9 110 11 12 13 14 15 16 QUESTION 3 Assuring Bhd. has the following transactions that had occurred during the year ended31December 2020 but were still unrecorded in its accounting books: Date Descriptions Jan 2020 A right issue was offered to existing ordinary shareholders right topurchase one share for every 20 shares held, at RM1.80 lower thanprice price on the date was RM6.30. All offers were takenshareholders Mar 2020 Obtained a loan amounting RM75,000 from Busy Bank Berhady on 1 March 2020. The loan is a 12-month loan and will be February 2021. July On 1 July 2020, 8% RM400,000 par value bonds were issu 2020 RM388.100 The bonds have a maturity period of 5 years. Transaction incurredwasRM5,000. The interests bonds were payable annual DecemberThe market rate when the bonds were issued was 9%. on On 15 July 2020. 100,000 new ordinary shares were issued at RM5.50, themar price of the share on that date. Sept. The company's sales of RM1.2 million included a 1-year warranty. warranty claims paid for the year so far was RM23,000. For 2020, company est warranty expense to be at 3% of the sales amounts. Nov 2020 Issued bonus shares to all ordinary shareholders on November 2020,ratio of one for every twenty shares held. Market value shareRM5.60. The retained earnings account was utilised for this purpose. Dec 2020 Dividends to all ordinary shareholders (except bonus issues November)were declared and approved. The dividend rate declared was RM0.20pershare and payable in January 2021. at a was The balances in the company's Statement of Financial Position at the beginning of Januaryl, 2020: Shareholders' Equity Ordinary share capital, 500,000 authorised, 250,000 issued 700,000 10% Preference share capital 100.000 Retained earnings 551,200 Liabilities Other liabilities 53.000 Provision for warranty expense 10.500 1,414,700 Required: 1. Prepare the relevant journal entries (with brief narrations) for the above transactionsand where no entries are required, state your reason. (13 marks) 2. Prepare the extract of the Statement of Financial Position of Assuring Bhd. at 31 December 2020 (showing the equity and liability sections only). (5Marks) 3. What is the main difference between Rights Issue and Bonus Issue? State ONEreasonfor companies to issue bonus shares. (2marks) Mata L20Marika the market upbythe at 9%per duein The the Ramat... M Gmail Yo 100% Times New 11.9 + BI U A 2 3 5 6 17 18 9 110 11 12 13 14 15 16 QUESTION 3 Assuring Bhd. has the following transactions that had occurred during the year ended31December 2020 but were still unrecorded in its accounting books: Date Descriptions Jan 2020 A right issue was offered to existing ordinary shareholders right topurchase one share for every 20 shares held, at RM1.80 lower thanprice price on the date was RM6.30. All offers were takenshareholders Mar 2020 Obtained a loan amounting RM75,000 from Busy Bank Berhady on 1 March 2020. The loan is a 12-month loan and will be February 2021. July On 1 July 2020, 8% RM400,000 par value bonds were issu 2020 RM388.100 The bonds have a maturity period of 5 years. Transaction incurredwasRM5,000. The interests bonds were payable annual DecemberThe market rate when the bonds were issued was 9%. on On 15 July 2020. 100,000 new ordinary shares were issued at RM5.50, themar price of the share on that date. Sept. The company's sales of RM1.2 million included a 1-year warranty. warranty claims paid for the year so far was RM23,000. For 2020, company est warranty expense to be at 3% of the sales amounts. Nov 2020 Issued bonus shares to all ordinary shareholders on November 2020,ratio of one for every twenty shares held. Market value shareRM5.60. The retained earnings account was utilised for this purpose. Dec 2020 Dividends to all ordinary shareholders (except bonus issues November)were declared and approved. The dividend rate declared was RM0.20pershare and payable in January 2021. at a was The balances in the company's Statement of Financial Position at the beginning of Januaryl, 2020: Shareholders' Equity Ordinary share capital, 500,000 authorised, 250,000 issued 700,000 10% Preference share capital 100.000 Retained earnings 551,200 Liabilities Other liabilities 53.000 Provision for warranty expense 10.500 1,414,700 Required: 1. Prepare the relevant journal entries (with brief narrations) for the above transactionsand where no entries are required, state your reason. (13 marks) 2. Prepare the extract of the Statement of Financial Position of Assuring Bhd. at 31 December 2020 (showing the equity and liability sections only). (5Marks) 3. What is the main difference between Rights Issue and Bonus Issue? State ONEreasonfor companies to issue bonus shares. (2marks) Mata L20Marika the market upbythe at 9%per duein The the

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