Prepare journal entries for the foregoing

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Reference no: EM132818036

Corporation: Formation and Share Capital Transactions Problem -

1. ABC Corporation which issues 15 par value ordinary shares, completed the following transactions during 2021:

a. Received subscription from Martinez for 25,000 shares at 18 per share.

b. Received from Martinez 45% of the subscription price

c. On due date, Martinez failed to pay the balance of the subscription. The shares were subsequently declared delinquent and were advertised for sale at a public auction.

d. Paid 4,000 for advertising the sale of the delinquent shares.

e. Received bids from the following:

Recto 10,000 shares

Zubri 9,000 shares

Pichay 12,000 shares

f. The amount due from the highest bidder, plus 12% interest for two months on the balance of the subscription price, was collected. Shares were accordingly issued.

Required -

(a) Prepare journal entries for the foregoing?

(b) Who is the highest bidder? Show the share allotment between the highest bidder and Martinez.

Reference no: EM132818036

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