Lesson Notes By Weeks and Term - Senior Secondary 2

Issues of shares II

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Term: 3rd Term

Week: 7

Class: Senior Secondary School 2

Age: 16 years

Duration: 40 minutes of 2 periods each

Date:       

Subject:      Financial accounting

Topic:-       Issues of shares II

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

  1. Prepare cash book
  2. Prepare application and allotment account
  3. Prepare share premium account
  4. Prepare share capital account

INSTRUCTIONAL TECHNIQUES: Identification, explanation, questions and answers, demonstration, videos from source

INSTRUCTIONAL MATERIALS: Videos, loud speaker, textbook, pictures

INSTRUCTIONAL PROCEDURES

PERIOD 1-2

PRESENTATION

TEACHER’S ACTIVITY

STUDENT’S ACTIVITY

STEP 1

INTRODUCTION

The teacher reviews the previous lesson on issues of shares

Students pay attention

STEP 2

EXPLANATION

She shows the learners how to prepare cash book and application and allotment account

 

Students pay attention and participates

STEP 3

DEMONSTRATION

She shows the learners how to prepare share premium account and share capital account

Students pay attention and participate

STEP 4

NOTE TAKING

The teacher writes a summarized note on the board

The students copy the note in their books

 

NOTE

ISSUING OF SHARES

ILLUSTRATION

ABC Nig. Ltd. Issue 200,000 ordinary shares of #1.00 each at#1.20 per share payable as follows:

  • 25k per share on application
  • 40k per share on allotment (including the premium)
  • 35k per share on first call
  • 20k per share on second and final call

Required: Show the ledger accounts to record the above transactions.

SOLUTION

Workings: 25+40+35+20=1.20.

Rate of premium=1.20-1.00=20korN0.20

Application:         0.25×200,000=N50,000

Allotment:  0.40×200,000=N80,000 (including premium)

Share premium:0.20×200,000=N40,000

First call:    0.35×200,000=N70,000

Second call:        0.20×200,000=N40,000

EVALUATION:             1. Mention three items in cash book.

  1. How do you ascertain share premium rate?
  2. Share premium account has what kind of balance?
  1. Prosperity PLC issued 600,000 ordinary shares of N1 each of N1.20 payable as follows;
    • 35k on application
    • 55k on allotment (including premium)
    • 20k on first call
    • 10k on final call

All the shares were fully subscribed and paid for. You are required to prepare:

  • Cash Book
  • Application and Allotment Account
  • First Call Account
  • Final Call Account
  • Share Premium Account
  • Ordinary Shares Capital Account.

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively