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The extract from the statement of financial position of Nemo Bhd as at 31 December...

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Accounting

The extract from the statement of financial position of Nemo Bhd as at 31 December 8 is given below.
Nemo Bhd
Statement of Financial Position as at 31 December x8(Extract)
Equity and reserves
Issued and fully paid-up capital
30,000,000 ordinary shares, fully paid up
Retained profits
Due to the liquidity problem faced by the company, the directors decided to give to the shareholders share dividend
of one ordinary share for every ten ordinary shares held and the retained profit was to be used for this purpose.
At the same time, Nemo made a rights issue of 1,000,000 shares to the existing shareholders at RM2 each. The
market price of the share was RM3 each.
Required:
Show the journal entries to record the transactions and prepare the statement of financial position after the
completion of the transaction.
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