Question

PLEASE NEED A HELP

15 MARK QUESTION 4 se the information given below and prepare the following 1 The journal entries to record the transaction given below (10). 2 The retained earnings account for the year ended 30 June 2017 (5). ning the year ended 30 June 2016, the directors of CCTV Ltd declared and paid a final idend out of retained earnings of $30 000 ey also declared and paid an interim dividend of $75 000 on 1 February 2017 e balance of the Retained Earnings account at 1 July 2016 was $100 000 O June 2017, the profit for the year was calculated as $500 b00 ever, the directors determined that the following adjustments were to be made Provide for an income tax liability of $150 000. Recommend the payment of a final dividend of $50 000 out of retained earnings Transfer $75 000 to a general reserve and $40 000 to a plant replacement neserve

Answer 1

q4)
1. Journal Entries:
Date	acc title	Debit $	Credit $
Feb 1 2017	Interim dividend	75000
	Cash		75000
	(being interim dividend declared and paid)
June 30 2017	Income tax expense	150000
	Income Summary		150000
	(being income tax paid on Income 2017)
June 30 2017	Income summary - Net Income	350000		(500000-150000)
	General reserve		75000
	Plant replacement reserve		40000
	Retained earnings		235000
	(being net income 2017 segregated between reserves)
June 30 2017	Dividend-final	50000
	Dividend payable		50000
	(being dividend-final declared )
June 30 2017	Retained earnings	125000
	Interim dividend		75000
	Dividend-final		50000
	(being dividend charged to RE)

2. Retained Earnings Account as on June 30 2017 :
DEBIT	AMOUNT $	CREDIT	AMOUNT $
June 30 2017	125000	OB	100000
CB	210000	June 30 2017	235000
Total	335000	Total	335000