WITH CLEAR DETAILS AND EXPLANATIONS SHOW ALL STEPS . On September 5, 2020, Bank of Kigali receives subscriptions for 65,000 shares of Frw10,000 parcommon stock at Frw15,000 per share. The subscription terms require a down payment of 40%,with the remainder of the purchase price to be paid in three equal installments, the firstinstallment to be paid in the mid of December, 2020, the second to be paid during the First weekof March, 2021, the third and last installment to be paid in last week of November, 2021.Akenes and Kennels Ltd, the subscriber of 15,000 shares failed to pay the last installment of thesubscription, and decision was to Issue shares to the defaulting subscriber based on the amountpaid in. The financial year ends every December 31.Requirement: Based on information above,1. Prepare the statement of Stockholders' Equity extract of Bank of Kigali on December 31,20202. Prepare the statement of Stockholders' Equity extract of Bank of Kigali on December 31,20213. How many will be outstanding stocks by December 31, 2021?

Share Subscription: A company may issue shares (shares) for subscription, and the subscription…

Answered: Requirement: Based on information…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On July 1, 2021, ABC Co. borrowed P1,000,000 and issued a one-year note payable. The lenderdiscounted the note at 12%.Prepare all the necessary journal entries under the following scenarios:a. The note is due on lump sum on June 30, 2022. The effect of discounting is immaterial.b. The note is due in equal quarterly installments starting September 20, 2021
On January 1, 2020, MWB, Inc. borrowed cash by issuing a $600,000, 6-year note that specified 6% interest to be paid on December 31 of each year and the $600,000 to be paid at maturity. If the note had instead been an installment note to be paid in six equal payments at the end of each year beginning December 31, 2020, which of the following would be true? Select one: a. The annual cash payment would have been less b. The first year's interest expense would have been higher c. The effective interest rate would have been higher. d. The second year's interest expense would have been less than in year one e. The second year's interest expense would have been less than in year three Clear my choice
On 1 August 2020, Candy Ltd issued a disclosure document inviting applications for 10,000 of $80 debentures at par, payable in full on application. The debentures carry an 8% annual interest charge and will be redeemed at nominal value in 5 years. The interest payment is made semi-annually on 31 December and 30 June each year. By 30 September 2020, Candy Ltd received application money for 11,000 debentures. On 1 October 2020, Courtney Ltd issued 10,000 debentures and refunded monies to 1,000 unsuccessful applicants. Required: Prepare a general journal template as per the example below based on the information above, for Candy Ltd for the year ended 30 June 2021. Include a narration.
MNO Bank granted a loan to a borrower on January 1, 2020. The interest on the loan is 10% payable annually starting December 31, 2020. The loan matures in three years on December 31, 2022. Additional information is as follows: Principal amount of P5,000,000; Direct origination cost incurred for P100,000; Indirect origination cost incurred for P50,000 and Origination fee received from the borrower was P340,000. After considering the origination fee received from the borrower and the direct origination cost incurred, the effective rate on the loan is 12%. Compute for the carrying amount of the loan receivable on December 31, 2020
Entei Bank granted a P5,000,000 loan to Raikou Company on January 1, 2020. The annual interest on the loan is 8% payable semi-annually. The loan matures in three years on December 31, 2022. The effective interest rate on the loan is 10%. How much is the total interest income to be presented on the statement of comprehensive income for 2020?
MNO Bank granted a loan to a borrower on January 1, 2020. The interest on the loan is 10% payable annually starting December 31, 2020. The loan matures in three years on December 31, 2022. Additional information is as follows: Principal amount of P5,000,000; Direct origination cost incurred for P100,000; Indirect origination cost incurred for P50,000 and Origination fee received from the borrower was P340,000. After considering the origination fee received from the borrower and the direct origination cost incurred, the effective rate on the loan is 12%. Compute for the interest income for 2020.
Suicune Bank granted a P5,000,000 loan to Raikou Company on January 1, 2020. The annual interest on the loan is 8% payable semi-annually. The loan matures in three years on December 31, 2022. The effective interest rate on the loan is 6%. How much is the carrying amount of the loan as of December 31, 2020?
On May 1, 2018, Meta Computer, Inc., enters into a contract to sell 5,000 units of Comfort Office Keyboard toone of its clients, Bionics, Inc., at a fixed price of $95,000, to be settled by a cash payment on May 1. Deliveryis scheduled for June 1, 2018. As part of the contract, the seller offers a 25% discount coupon to Bionics for anypurchases in the next six months. The seller will continue to offer a 5% discount on all sales during the same timeperiod, which will be available to all customers. Based on experience, Meta Computer estimates a 50% probabilitythat Bionics will redeem the 25% discount voucher, and that the coupon will be applied to $20,000 of purchases.The stand-alone selling price for the Comfort Office Keyboard is $19.60 per unit.Required:1. How many performance obligations are in this contract?2. Prepare the journal entry that Meta would record on May 1, 2018.3. Assume the same facts and circumstances as above, except that Meta gives a 5% discount option to…
On January 1, 2020, Lynn Company borrows $3,000,000 from National Back at 11% annual interest. In addition, Lynn is required to keep a compensatory balance of $300,000 on deposit at Natinal Banck which will earn interest at 5% the effective interest that Lynn pays on its $3,000,000 loan is?
DBC Company has received a confirmation letter from the First National Bank of Miami (FNBM) about a line of credit for $12,000,000 on January 2, 2020. According to the terms of this short-term loan, DBC Company will be charged the following: A. ABC will be charged for 50 basis points interest (on an annual basis) for any unused amount of credit from the commencement of this agreement. B. Upon usage of any funds, the interest charge will be Prime rate plus 75 basis points. Prime rate at the commencement of this loan on January 2, 2020, was 5.25%. C. The following events took place in 2020: 1) On February 1, 2020; DBC Co., used $4,000,000 against its line of credit for its working capital purposes. 2) On May 1, 2020; DBC Co., used an additional $2,400,000 to purchase fixed assets. 3) On June 1, 2020, upon the meeting of F.O.M.C., the Fed announced its "Quantitative Easiness" policy and reduced the discount rate by 0.50 basis points. Immediately FNBM bank reflected the same reduction to…
On January 1, 2020, Caribou Explorations Limited (CEL) sold inventory costing $32,000 and, in exchange, received $6,000 cash and a $40,000 promissory note. The five-year note was repayable in equal annual instalments of $8,734 including interest at 7%. The market rate of interest for similar transactions was 7%. The first payment was due January 1, 2021. CEL has a December 31 year-end and follows IFRS. CEL uses the net method. CEL also extends generous payment terms to its many customers. As a result, the company has accumulated a substantial portfolio of accounts receivables. To improve cash flow, the company decided to sell some of its receivables to a factor. On June 30 2020, CEL factored $300,000 of its account receivables. CEL had previously checked the creditworthiness of its customers and is, therefore, confident that only a few accounts will be uncollectible. Therefore, the company chose to factor these receivables with recourse. In exchange for these receivables, the factor…
On January 1, 2021, Glanville Company sold goods to Otter Corporation. Otter signed an installment note requiring payment of $21,500 annually for five years. The first payment was made on January 1, 2021. The prevailing rate of interest for this type of note at date of issuance was 10%. Glanville should record sales revenue in January 2021 of: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Multiple Choice $107,500 $81,502 $89,652 None of these answer choices are correct.

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Requirement: Based on information above, 1. Prepare the statement of Stockholders' Equity extract of Bank of Kigali on December 31, 2020 2. Prepare the statement of Stockholders' Equity extract of Bank of Kigali on December 31, 2021 3. How many will be outstanding stocks by December 31, 2021?