Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

The data below relate to a limited company’s financial year ending 31 December. 1 On 1 January, total equity stood at $350000. This figure included 100000 ordinary shares of $1 each. 2 A rights issue of 10000 ordinary shares at $1.50 each took place on 30 June. It was fully subscribed. 3 On 1 October, the company paid a dividend of $0.10 for each ordinary share. 4 A dividend amounting to $20000 was proposed on 1 December. 5 The profit for the year was $26500. What was the total equity on 31 December?

  • A$360500
  • B$375500
  • C$380500
  • D$391500

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