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A-LevelAccountingPreparation of financial statements9706/12 · May/June 2023 · Q181 Mark

X Limited had the following equity on 1 January. $ ordinary share capital ($1 shares) 400 000 share premium 30 000 general reserve 10000 retained earnings 70000 During the year ended 31 December, the following transactions took place. 1 January a bonus issue of 1 ordinary share for every 8 ordinary shares; it is the company's policy to keep its reserves in the most flexible form 1 July an issue of debentures for $150 000 1 December a rights issue of 1 ordinary share for every 15 ordinary shares at a price of $1.60 per share; the rights issue was fully taken up 31 December profit for the year ended 31 December was $120000 What was the total equity at 31 December?

A$678000
B$728000
C$828 000
D$878000

✓ Correct answer

A: $678000

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About this question

Topic
Preparation of financial statements, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source
A-Level Accounting, May/June 2023 Paper 1 Variant 2, question 18.

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