Reference no: EM132618817

Question -

1. Discuss the importance of Ethics in companies and identify potential ethical issues a company can face. Relate your discussion with relevant examples.

2. "Many businesses start life as sole traders or partnerships and convert to limited companies later". Discuss the above statement and explain at least two factors prompting such conversion in future.

3. Dolphin Co Ltd was registered on 1 June 2019 with a capital of 200 000 $1 shares. On 2 June 2017 the directors decided to issue 150 000 shares to the public on the following terms:

$0.25 on application

$0.50 on allotment

$0.25 on call

Application had been received for 170 000 shares and refund were made to remaining unsuccessful applicants. Allotment money due was received by 1 August 2019, at which date the call was made.

Required - Using the above information,

A. Prepare the necessary journal entries.

B. Prepare Shareholders Equity section of the statement of financial position as at 1 August 2019.