Question - Bennett Biomedical Ltd (BBL) began business 25 years ago. Its growth has been strong and it has always been able to pay dividends to its shareholders. Its financial years end on 30th June.
The following are a series of events relating to dividends for Ordinary shareholders of BBL:
10/6/20X1 - Determined the final dividend for the year of $0.11/share to be paid out of profits.
31/8/20X1 - BBL issues a private placement of 1,000,000 shares with full rights.
10/10/X1 - The Annual General Meeting of BBL assents to the final dividend of $0.11/share and is paid on the following day.
15/1/20X2 - Declared an Extraordinary dividend of $0.06/share to be paid out of a Asset Revaluation Surplus reserve.
18/3/20X2 - Declared and paid an interim dividend of $0.09/share out of profits.
12/6/20X2 - Determined the final dividend for the year of $0.12/share to be paid out of profits.
30/9/20X2 - The Annual General Meeting approves the final dividend of $0.12/share and is paid on this date.
The Register of Shareholders shows the following number of Ordinary shares issued at particular dates:
10/6/20X1 6,505,500
10/10/20X1 7,505,500
15/1/20X2 7,505,500
18/3/20X2 7,555,036
12/6/20X2 7,629,831
30/9/20X2 7,629,831
BBL had always paid all dividends in cash. In 20X1 though it offered shareholders the opportunity to take dividends in shares (ie a Dividend Reinvestment Plan). 55% of shareholders accepted this offer with effect for any dividends paid after 31/12/20X1.
REQUIRED - Prepare general journal entries with narrations to record all the transactions dealing only with dividends for all events described. Round numbers to the nearest dollar where applicable.