Reference no: EM133130946

Question - Z Network was established in 2021. It provides networking and connectivity services locally and to neighbouring ASEAN countries. The business has been expanding rapidly since its incorporation. On 31 December 2021, the statement of financial position (extract) of Z Network reported the following: Z Network Statement of Financial Position (Extract) As at 31 December 2021 RM Paid-in Capital: Preference shares, 4% RM55 par, 140,000 shares authorised, none issued. - Ordinary shares, RM2, 540,000 shares authorised, 62,000 shares issued and outstanding. 124,000 Paid-in Capital in excess face value - ordinary 42,000 Total paid-in capital 166,000 Retained earnings 28,000 194,000 Additional information: During 2021, the company completed the following transactions: i. Issued 1,500 preference shares at face value for cash. ii. Issued 2,000 ordinary shares at a price of RM7 per share. iii . The net income during the year was RM78,000 and the company declared no dividend. Make closing entry for the net income.

Required -

a) Record the issuance of shares during the year.

b) Prepare the shareholder's equity section of Z Network as at 31 December 2021.