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On 1 August 2014, Piper Ltd makes an offer of 1,000,000 ordinary shares to the public. The shares are to be issued at $2 per share, payable as follows:
$0.80 on application (due 31 August)
$0.80 on allotment (due 30 September)
$0.40 on final call
By 31 August 2014, applications had been received for 1,100,000 ordinary shares. Shares were allotted on 2 September 2014. To deal with the oversubscription, Piper Ltd provided a refund to unsuccessful applicants.
The issue was underwritten at a commission of $12,500, and this commission was paid on 15 September 2014. All amounts due on allotment are paid by the due date.
The final call was made on 1 December 2014 with money due by 31 December 2014. All money was received on the due date except for the holder of 50,000 shares who failed to meet the final call. On 5 January 2015, the shares on which the call was unpaid were forfeited. According to the constitution, a refund is to be provided to former shareholders, and this refund was paid on 7 January 2015.
On 3 March 2015, Piper Ltd makes a private placement of redeemable preference shares, and 500,000 6% redeemable preference shares are issued at a price of $3 per share. These shares are classified as equity, and are redeemable at a 10% premium. On 30 April 2017, the preference shares are redeemed out of profits and cheques are sent to preference shareholders on 2 May 2017.

Prepare the general journal entries to record the transactions of Piper Ltd for the events outlined above. Show all workings. Ignore preference share dividend payments.


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