Reference no: EM133492902

Case: Wakanda Ltd is one of the leading high-tech companies in Australia. The equity of Wakanda Ltd is comprised of share capital and retained earnings. Share capital at 1 July 2022 comprised 1,700,000 ordinary shares. These were issued in March 2019 at an issue price of $2.10 with the share issue cost of $37,000. The balance of retained earnings as at 1 July 2022 was $2,855,000.

Information about some transactions and events relating to Wakanda Ltd is below:

(a) During the year ending 30 June 2023, Wakanda Ltd issued new shares and the related transactions and events are:

• On 1 August 2022, Wakanda Ltd issued a prospectus calling for application for 1,300,000 ordinary shares from the public at an issue price of $3.50 - payable $1.50 on application, $1.50 on allotment and the reminder on the future calls.

• By 31 October 2022, it had received 1,600,000 applications with $1.50 paid.

• On 15 February 2023, the company issued the shares and made refunds to 300,000 applicants. Costs incurred in the share issue totalled $45,000 and were paid on 15 February 2023.

• A call of $0.50 per share was made on 15 May 2023. All call monies were received by 25 June 2023 except for holders of 8,000 shares.

(b) On 8 September 2022, the company paid a dividend of $298,000. This dividend had been declared on 29 June 2022. This dividend was not subject to further authorisation or approval.

(c) On 30 June 2023, the directors decided to make a general reserve by transferring $2,000,000 from retained earnings to a general reserve account.

(d) Directors declared a final dividend on 10 July 2023 of 12 cents per share from retained earnings. This does not require further authorisation or approval and is expected to be paid following the AGM on 18 September 2023

REQUIRED:

Question 1) Prepare the general journal entries required to account for the transactions and events described in (a) ~ (d) for the year ending 30 June 2023. Narrations are not required. Show all your working/calculations.

Question 2) Prepare the Statement of Changes in Equity for the year ending 30 June 2023. The net profit for the year ending 30 June 2023 amounted to $3,450,000.

Question 3) In relation to the dividend declared in July 2023, please prepare the Note required under AASB 101 and identify the accounting standard (including the paragraph number) requiring any note. (Hint: You need to prepare the note itself - not explain what is required to be disclosed).