AC 121

Corporation accounting application

Vos Malyk Balones
dated 4/16/2024

Description Debit Credit

Share issuances for cash
1. Issuing share capital @ par value
authorized share capital- 1,000,000.00
ordinary share
(10,000 shares x 100 par value)

note- issued 2,000 share @ par on cash basis

Entry:
Cash 200,000.00
Ordinary shares 200,000.00
(2,000 shares X 100 par)

2. Issuing share capital above par value

note- same case in #1 but sold at 150 per
share
Entry:
Cash 300,000.00
Ordinary share 200,000.00
Share premium 100,000.00
(2,000 share x 100 par- ordinary
shares)

(2,000 share x 50 par- share premium)

3. Issuing share capital (no par value)

2 classes of shares- preference shares and
no- par ordinary shares
5,000 ordinary shares were issued at
85,000.00
Entry:
Cash 85,000.00
Ordinary shares 85,000.00

4. no-par but with stated value

MST Co., no-par ordinary shares have a

stated value of 20.00 per share; entity issued
5,000 shares at 25.00 per share
4.1 entry
Cash 125,000.00
Ordinary shares 125,000.00

4.2 entry
Cash 125,000.00
Ordinary shares 100,000.00
Share premium 25,000.00

Subscription of shares
WAS Inc.

Sept 1, 20xx- 5,000 shares of 10.00 par value

ordinary shares sold on subscriptions at
12.00 per share

Sept 16: 24,000.00 subscription installment

Sept 30: 36,000.00 subscription installment

Entry 1: Sept 1 (entry related to

subscriptions)
Subscriptions Receivable 60,000.00
Subscribed ordinary shares 50,000.00
Share premium 10,000.00

Entry 2: Sept 16 (entry related to intial

installment)
Cash 24,000.00
Subscription Receivable 24,000.00

Entry 3.1: Sept 30 (entry related to final

installment)
Cash 36,000.00
Subscriptions receivable 36,000.00

Entry 3.2: Sept 30 ( entry related to issuance

of stock certificate)
Subscribed ordinary shares 50,000.00
Ordinary shares 50,000.00

highest bidder illustration

WAS Inc.

Sept 1, 20xx: 5,000 shares of 10.00 par value

ordinary shares sold on subscriptions at
12.00 per share
note- subscriber failed to settle 48,000.00
Public auction:
offer price is 56,000.00
unpaid balance 48,000.00
accrued interest (interest revenue) 3,000.00
other expenses related to auction (aution
expenses) 5,000.00
56,000.00
bidders:
L bidder (highest bidder) 4300 shares
U bidder 4500 shares
W bidder 4700 shares

Entry 1: Sept 1 (entry related to

subscriptions)
Subscriptions Receivable 60,000.00
Subscribed ordinary shares 50,000.00
Share premium 10,000.00

Entry 2: Sept 16 (entry related to intial

installment)
Cash 12,000.00
Subscription Receivable 12,000.00

Entry 3: (entry related to accrued interest on

delinquent shares )
Receivable from highest bidder 3,000.00
Interest income 3,000.00

Entry 4: (entry related to auction expenses)

Receivable from highest bidder 5,000.00
cash 5,000.00

Entry 5.1: (entry related to L bidder, highest

bidder)
Cash 56,000.00
 Receivable from highest bidder 8,000.00
Subscriptions Receivable 48,000.00

Entry 5.2: (entry related to issuance of stock

certificate)
Subscribed ordinary shares 50,000.00
Ordinary shares 50,000.00

if there is no bidder, the corporation will bid

for the delinquent shares and will be
considered as treasury shares, entry will be:

Treasury shares 56,000.00

Receivable from highest bidder 8,000.00
Subscriptions receivable 48,000.00

END