Prepare journal entries for the above transactions

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Reference no: EM13539481

Question 1
Mekar Niaga Bhd (Mekar Niaga) is an oil and gas company which is authorised to issue 10,000,000 Ordinary shares and 1,000,000 Preference shares. Balances of owner equity accounts as at 31 December 2013 are as follows:
RM
Ordinary shares 1,000,000
10% Preferred shares 500,000
Share premium 45,000
Retained earnings 2,450,000
On 1 January 2014, Mekar Niaga made a public offering of 500,000 units of ordinary shares at the price of RM2.10 per share.The company also offered 100,000 units of 10% preferred shares at RM10 per share.All of the shares issued were taken up and fully paid by 31 January. The par value of the ordinary share and the preferred share of Mekar Niaga are RM1.00 and RM10.00 each, respectively. On 31 December 2014, the board of directors announced dividends to the preferred shareholders and 5% to the ordinary shareholders. The company made RM534,000 net profit for the current year.

REQUIRED:
a) Prepare journal entries for the above transactions.

Reference no: EM13539481

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