A Company Issued 105,000 Preferred Shares and Received Proceeds of $6,100,000.These

question 86

Essay

A company issued 105,000 preferred shares and received proceeds of $6,100,000.These shares have a par value of $50 per share and pay cumulative dividends of 6%.Buyers of the preferred shares also received a detachable warrant with each share purchased.Each warrant gives the holder the right to buy one common share at $35 per share within 10 years.
The underwriter estimated that the market value of the preferred shares alone,excluding the conversion rights,is approximately $55 per share.Shortly after the issuance of the preferred shares,the detachable warrants traded at $5 each.
Requirement:
Record the journal entry for the issuance of these shares and warrants under IFRS.

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Definitions:

Fixed Range

A predefined interval within which an operational value (such as inventory levels) is maintained.

High-Low Method

A method applied within cost accounting that determines variable and fixed costs by examining the extremes of activity levels.

Fixed Cost

Costs that remain constant regardless of the amount of output or sales, like lease payments, wages, and insurance fees.

High-Low Method

A technique used in cost accounting to determine variable and fixed costs based on the highest and lowest levels of activity.