SET 1

Anggerik Vanda Bhd has been in the business of selling automobile spare parts for several
years. The Statement of Financial Position showed the following financial position as at 1
March 2018.

RM
Non-current assets 3,900,000

Current assets (including bank) 1,100,000

TOTAL ASSETS 5,000,000
Equity and Liabilities
1,000,000 Ordinary shares 1,500,000
800,000 Preference shares 1,200,000
2,700,000
Reserves
Retained Profits 900,000
General reserve 200,000

Non-current liabilities
8% Bank loan 50,000

Current Liabilities 1,150,000

TOTAL EQUITY AND LIABILITIES 5,000,000

The following transactions took place during the year ended 31 March 2018:
1. 250,000 ordinary shares were issued at RM1.20 per share, payable in full on
application. Applications received were oversubscribed by 500,000. Excess
application monies were refunded. The cost incurred on issuance of shares was
RM1,000 and need to be set off against retained profits.

2. A 6% debenture amounting RM350,000 was issued at RM330,000. Discount on

debenture need to be set off against retained profits.

3. The company also made a rights issue of 1 new ordinary share for every 10 existing
shares held on 1 March 2018 at a price of RM2.00 per share. The market value of
the share was RM2.50 per share.

4. Anggerik Vanda Bhd purchased 10,000 of its own shares at a price of RM15,000.
Transaction costs amounting to RM500. The company chose to hold the shares in
treasury shares.

Required:
a) The journal entries to record the above transactions based on the Companies Act
2016.

b) Statement of Financial Position of Anggerik Vanda Bhd as at 31 March 2018 after the
completion of the above transactions.
SET 2
Matahari Bhd has been in the business of selling automobile motorcycles spare parts for
several years. The following are the extract relevant information from the company at the
beginning of the year as at 1 April 2018:

Equity and Liabilities:

1,000,000 Ordinary shares RM1,500,000
800,000 Preference shares RM1,200,000
Reserves:
Retained Profits RM 900,000

The following transactions took place during the year ended 31 March 2019:
1. The company decided to distribute bonus issue of 1 for every 50 existing shares held at
the beginning of the year at a price RM1.20 per share. To finance the issue, company
utilizes the retained profits.

2. A 8% debenture valued at RM400,000 was issued at RM385,000. Discount on

debenture need to be set off against retained profits.

3. The company also made a rights issue of 1 new ordinary share for every 10 existing
shares held at the beginning of the year at a price of RM2.00 per share. The market
value of the share was RM2.50 per share.

4. Matahari Bhd purchased 50,000 of its own shares at a price of RM120,000. Transaction
costs amounting to RM1,500. The company chose to hold the shares in treasury shares.

5. 250,000 ordinary shares were issued at RM1.50 per share and fully subscribed. The
cost incurred on issuance of shares was RM5,000 and need to be set off against
retained profits.

Required:
a. The journal entries to record the above transactions based on the Companies Act
2016.
b. Explain the distributable and non-distributable reserves and give ONE (1) example
each.
c. Give TWO (2) criteria each in order to differentiate between ordinary share and
preference shares.
d. Explain the golden share.
SET 3
Meta Global Bhd has authorised share capital consisting of 50,000,000 ordinary shares with
par value of RM 0.50 each. The extract from the company’s Statement of Financial Position
as at 1 January 2017 is as follows:

10,000,000 ordinary shares (fully paid up) RM 5,000,000

Share Premium RM 2,500,000
Retained profit RM 1,000,000

On 1 February 2017 the company issued 500,000 ordinary shares at RM 2.00 each for cash.
All the shares were fully subscribed. On 2 May 2017, all the shares were allotted and fully
paid up. The cost of issue was RM50,000. The cost of issue shall be written off against the
retained profits.
On 1 September 2017 the company purchased 1,000,000 of its own shares at a price of
RM2.00 per share. Transaction costs amount to RM100,000. The company chose to hold
the shares in treasury shares.

Required:
a) Explain briefly the following terms:
i. Right Issue
ii. Share Split (under the original Companies Act 1965)

b) State four reasons or motivations for share buybacks.

c) Show the journal entries to record the conversion of the fully paid up shares to No
Par Value shares on 1 January 2017.

d) Show the journal entries to record the issuance of shares on 1 February 2017 based
on the Companies Act 2016.

e) Show the journal entries to record the shares repurchased on 1 September 2017
based on Companies Act 2016.
SET 4
Meta Green Bhd was incorporated in 2015 and had contributed share capital amounting
RM15,000,000 consisting of 30,000,000 ordinary shares at RM 0.50 each and retained profit
RM4,500,000 as at 31 August 2017.

The following transactions took place for the company during the year ended 31 August
2018:

a) On 15 September 2017, the company decided to give a rights issue of 1 new

ordinary share for every 10 existing shares held on 1 September 2017 at a price of
RM1.50 per share. The market value of the share was RM2.00 per share.

b) On 1 December 2017, the company issued additional new 500,000 ordinary shares
at RM 1.00 each for cash to the public. All the shares were fully subscribed and the
cost of issue was RM50,000. The cost of issue then shall be written off against the
retained profits.

c) On 1 May 2018, the company purchased 1,000,000 of its own shares at a price of
RM2.00 per share. Transaction costs amount to RM100,000. The company chose to
hold the shares in treasury shares.

d) On 20 August 2018, the company issued 500,000 ordinary shares in exchange for a
factory building. At the date of the exchange, the shares of the company were quoted
at RM2.10 per share. An independent professional valuer had placed a market value
on the building at RM1,000,000.

Required:

a. Show the journal entries to record the above transactions based on Companies Act
2016.

b. State TWO (2) criteria of ordinary share.

c. Explain briefly the following terms:

 Right Issue
 Bonus issue

d. Give FIVE (5) impacts with the introduction of No Par Value (NPV) regime under new
Companies Act 2016.