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The document contains 10 accounting problems related to shareholders' equity. It provides various capital account balances, share transactions, and asks to calculate totals or account balances.

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Rhozeiah Leiah
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125 views2 pages

She

The document contains 10 accounting problems related to shareholders' equity. It provides various capital account balances, share transactions, and asks to calculate totals or account balances.

Uploaded by

Rhozeiah Leiah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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1 The accounts shown below appear in the December 31, 2016 trial balance of One Corporation:

Preference share, authorized, P50 par 10,000,000


Unissued preference share 3,600,000
Ordinary share, authorized, P20 par 4,000,000
Unissued ordinary share 2,000,000
Subscription receivable, preference share 380,000
Subscription receivable, ordinary share 360,000
Subscribed preference share 600,000
Subscribed ordinary share 440,000
Treasury share, preference, at cost 1,360,000
Share premium 1,700,000
Accumulated profits and losses 2,000,000

All subscription receivables are due in year 2017.

How much is the total shareholders' equity?

2 Two Company disclosed the following information for the year ended December 31, 2016:
Bonds payable 300,000
Share premium on ordinary share 50,000
Donated capital 40,000
Treasury share at cost 20,000
Ordinary share capital, par P100 500,000
Ordinary share option warrants 100,000
Investments in AFS securities 70,000
Share premium from treasury share 15,000
Accumulated profits and losses 135,000

What is the total shareolders' equity of Two Company?

Three Company issued 20,000 shares of its P10 par value ordinary shares and 40,000 shares of its P10 par
value convertible preference share for a total amount of P1,800,000. At this date, Three's ordinary share was
selling P20 per share and the convertible preference share was selling P30 per share. What amount of the
3 proceeds should be allocated to the ordinary share?

4 Four Company was incorporated on January 1, 2016 with the following authorized capitalization:
* 40,000 ordinary shares, no par value, stated value P40 per share
* 10,000 shares of 5% cumulative preference share, par value P10 per share

During 2014, Four Company issued 24,000 ordinary shares for a total of P1,200,000 and 6,000 preference
share at P16 per share. In addition, on December 19, 2016 subscriptions for 2,000 preference share were
taken at a purchase price of P17. These subscribed shares were paid for on Janaury 2, 2017. What should
Four Company report as total contributed capital in its December 31, 2016 balance sheet?

5 The shareholders' equity section of Five Company revealed the following information on December 31, 2016:

Preference share (P100 par), P2,300,000; share premium in excess of par - preference, P85,000; ordinary
share (P15 par), P5,250,000; share premium in excess of par - ordinary, P2,750,000; subscribed ordinary
share, P50,000; accumulated profits and losses, P1,900,000; and subscriptions receivable ordinary,
P400,000. How much is the legal capital?

Six Corporation is authorized to issue 100,000 shares at P20 par ordinary share. At the beginning of 2016,
18,000 ordinary shares were issued and outstanding. These shares had been issued at P27 per share. During
6 2016, the company entered into the following transactions:

January 2 Issued 1,300 ordinary shares at P28 per share


March 19 Exchanged 12,000 ordinary shares for a machine

The ordinary share was selling at P30 per share


May 8 Reacquired 500 ordinary shares at P29 per share
Accepted subscriptions for 1,000 ordinary shares at P31 per share. The contract
July 19 called for 10% downpayment with the balance due on December 1
September 1 Sold 500 of treasury shares at P32 per share
December 1 Collected the balance due on July 1 subscriptions and issued the stock certificate

How much is the total contributed capital for December 31, 2016?

On July 1, 2016, Seven Company has 200,000 shares of P10 par ordinary share outstanding and the market
price of the share is P12 per share. On the same date, Seven declared a 1 for 2 reverse share split. The par of
the share was increased from P10 to P20. Immediately before the split, the total share premium was
7 P900,000. What should be the balance in Seven's share premium account after the reverse share split is

Effective April 23, 2016, the shareholders of Eight Corporation approved a 2 for 1 share split of its ordinary
shares and an increase in authorized ordinary share from 100,000 shares (par value P80 per share) to
200,000 shares (par value P40 per share). Eight's shareholder's equity accounts immediately before issuance
8 of the share split were as follows:
Ordinary share (par value P80, 100,000 shares authorized, 50,000 shares outstanding) - P4,000,000; share
premium (P12 per share on the issuance of ordinary share) - P600,000; and accumulated profits and losses -
P5,400,000

The split shares were issued on June 30, 2016.

In Eight's June 30, 2016 statement of shareholder's equity, balances of share premium and accumulated
profits and losses, respectively, are:

Nine Corporation purchased 10,000 shares of its P10 par value ordinary share as treasury share for P120,000
on March 2, 2016. On December 19, 2016, Nine issued all 10,000 treasury shares for P190,000. Under the
9 cost method of accounting for treasury share, what is the entry for reissuance?

10 The following capital accounts are shown in the balance sheet of Ten Corporation:
Ordinary share, 10,000 shares, par value P100 1,000,000
Premium on ordinary share 20,000
Share premium - treasury shares 30,000
Accumulated profits and losses 750,000
Treasury share, 2,000 shares at cost 250,000

The entire 2,000 treasury shares were sold for P200,000.

What would be the balance of the acumulated profits and losses account after this sale?

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