Journal Entries for Share Application and Allotment

Answer 1: One Beauty Limited
Profit and Loss Account for the year ended 30 June 2019
Particulars Note Amount
($)
Amount ($)
NET REVENUE 11,06,000
Cost of Sales(COS) 5,24,000
Gross Profit 5,82,000
OPERATING (EXPENSES) INCOME
Selling and distribution 1 2,25,200
Administrative 2 2,73,800
Other operating expenses (income), net 3 (30,000)
4,69,000
INCOME FROM OPERATIONS BEFORE FINANCIAL INCOME
(EXPENSES)
1,13,000
Financial income 4 8,000
Financial expenses 5 21,000
INCOME BEFORE INCOME TAX 1,00,000
Income tax 39,000
NET INCOME 61,000
STATEMENTS OF COMPREHENSIVE INCOME for the year ended 30 June 2019
NET INCOME 61,000
Other comprehensive income to be reclassified to profit or loss
in subsequent periods:
Gain on Foreign currency translation 18,000
Tax on Gain on Foreign currency translation (3,000)
Other Comprehensive Income 15,000
Total comprehensive Income 76,000

Notes:
1 Selling and distribution
Depreciation – motor vehicles 40,800
Doubtful debts expense 11,000
Rental expense 11,900
Salaries 93,500
Selling expense 68,000
2,25,200
2 Administrative
Amortization expense - patent 30,000
Depreciation – motor vehicles 27,200
Office expense 85,000
Rental expense 5,100
Salaries 93,500
Miscellaneous expense 28,000
Impairment loss – goodwill 5,000
2,73,800
3 Other operating (expenses) income, net
Gains from sales of motor vehicles 10,000
Proceeds from insurance claims 20,000
30,000
Working Notes:
A Working Allocation of
Common Expenses
Allocation Amount Allocation Basis
Particulars As per
Trial
Balance
Administrativ
e
Selling and
distributio
n
Administrativ
e
Selling and
distributio
n
Amortization expense -
patent
30,000 30,000 - 100% 0%
Depreciation – motor
vehicles
68,000 27,200 40,800 40% 60%
Doubtful debts
expense
11,000 - 11,000 0% 100%
Office expense 85,000 85,000 - 100% 0%
Rental expense 17,000 5,100 11,900 30% 70%
Salaries 1,87,000 93,500 93,500 50% 50%
Selling expense 68,000 - 68,000 0% 100%

Miscellaneous expense 28,000 28,000 - 100% 0%
B Patent (cost) 2,20,000
Accumulated
amortization – patent
20,000
Ammortisation in PL 18,000
Life assumed 147
Monthly
Ammortisation
1,500
Time elapsed (A) 13
Actual Life remaining
until 31 Dec 2025 from
30 June 2019 (B)
78
Total Life (A+B) 91
Ammortisation till date 32,117
Round off 32,000
Already Amortised 2,000
Amortisation in current
year PL
30,000

One Beauty Ltd
Statement of change in Equity as of 30 Jun2019
Particulars Equity Share
Capital
Retained
Earnings
Currency Translation
reserve
Opening Balance as on 01 July
2018
4,00,000 52,000 10,000
Interim Dividend Paid - (16,000) -
Profit for the year - 61,000 -
Foreign currency Translation
Gain
- - 15,000
Closing balance as on 30 June
2019
4,00,000 97,000 25,000
Working Notes:
A Retained earnings at 16
December 2018
36,000
Add: Interim Dividend Paid 16,000
Retained earnings at 01 July
2018
52,000
One Beauty Ltd
Statement of Financial Position as on 30 June 2019
ASSETS Note Amount ($)
Non-current Assets
Property, Plant & Equipment 6 2,69,000
Intangible Assets 7 2,63,000
Deferred tax assets 18,000
Current Assets
Cash & Cash Equivalent 8 1,34,000
Inventories 92,000
Accounts receivable (Net) 9 1,07,000
Total Assets 8,83,000
EQUITY AND LIABILITIES
EQUITY
Equity Capital 4,00,000
Retained Earnings 97,000