Required: Compute the following a. Contributed capital b. Legal capital c. Total shareholders' equity
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- The Shareholders' Equity section of BFAR Corp. statement of financial position shows the following: Preference Share Capital, P100 par Ordinary Share Capital, P10 par Treasury Shares - ordinary, P12 cost/share Share Premium - Ordinary Share Premium - Preference Subscribed Ordinary Share Capital Subscription Receivable (2 years collectability) Share Premium on Subscribed Ordinary shares Share Premium on Treasury shares Accumulated Profits - Unappropriated (unadjusted) - beg 2,800,000 6,000,000 960,000 1,640,000 1,020,000 750,000 600,000 625,000 610,000 7,040,000 Dividends declared during the year is P500,000. Profit for the year is P800,000. Compute the Total Shareholders' Equity.profits in 20x3. No dividends have been declared since 20x1. PROBLEM 4: CLASSROOM ACTIVITY SUCCOR HELP AID RELIEF Co. declared P3,600,000 cash dividends to its preference and ordinary shareholders out of its profits in 20x3. No dividends have been declared since 20x1.MAKE T-ACCOUNT for the following: Ordinary shares Preference shares Share premium- Ordinary shares Share premium- Preference shares Share premium- Treasury shares Total additional paid-in capital Total contributed capital Total stockholders’ equity
- S1: The conversion of preference share capital into ordinary share capital increases the total shareholders' equity. S2: The Donated Capital account is shown as part of share premium of the reserves section of the shareholders' equity. a. Only S1 is correct b. Only S2 is correct c. Both statements are correct d. Both statements are incorrect.4. An entity showed the following data:Share capital, par value P50 5,000,000Share premium 200,000Retained Earnings 2,000,000Market value of share on declaration date 75Market value of share on distribution date 85Treat each item independently: a. If the entity would declare a 1 for 5 share dividend, what amount would be charged to retained earnings? b. What amount will be credited to share premium if the entity would declare 15% share dividend?profits in 20x3. No dividends have been declared since 20x1. PROBLEM 4: CLASSROOM ACTIVITY SUCCOR HELP AID RELIEF Co. declared P3,600,000 cash dividends to its preference and ordinary shareholders out of its profits in 20x3. No dividends have been declared since 20x1.
- Subject: Financial Accounting and Reporting Required: Determine the followinga. Issue price of preference sharesb. Ordinary shares issuedc. Ordinary shares outstandingd. Issue price of ordinary sharese. Legal capital of the corporationf. Contributed capital of the corporationg. Total shareholders’ equityh. Cost per treasury shareMatch each of the following terms with the correct definition: a. additional paid-in capitalb. issued and outstandingc. retained earningsd. treasury stocke. authorized share capitalf. par value Correct Definitions:A. The price at which each share is recorded in the company’s booksB. Held by investorsC. Cumulative amount of profits that have been plowed backD. The difference between the amount of cash raised by an equity issue and the par value of the issueE. The maximum number of shares that can be issued without shareholder approvalF. The amount that the company has spent buying back stock that it has not subsequently resoldMatch each of the following terms with the correct definition: a. additional paid-in capitalb. issued and outstandingc. retained earningsd. treasury stocke. authorized share capitalf. par value Correct Definitions:A. The price at which each share is recorded in the company’s booksB. Held by investorsC. Cumulative amount of profits that have been plowed backD. The difference between the amount of cash raised by an equity issue and the par value of the issueE. The maximum number of shares that can be issued without shareholder approvalF. The amount that the company has spent buying back stock that it has not subsequently resold SELECTED FORMULAS PVIFA = PVIF = requity = rassets + (rassets – rdebt) PV of tax shield = = Tc *DWACC = (1-Tc) * *() + *()
- You are given the following information: ordinary shares, P80,000 (P80par); Share Premium-Ordinary, 200,000; and Retained Earnings, P400,000.Assuming only one class of share, the book value per share is? a.P280 b. P680 c. P80 d. P400Problem 2: (Book Value per share with Two Classes of Preference Shares)TINT Corporation presents the following condensed statement of financial position as of the close of the year:Cash ₱ 520,000 Accounts Payable ₱ 550,000Other Assets 1,333,000 Ordinary Share Capital 550,0005% Preference Share Capital 330,0007% Preference Share Capital 220,000Accumulated Profits 203,000Total Assets ₱ 1,853,000 Total Equities ₱ 1,853,000The 5% preference share capital is cumulative, the 7% preference share capital is non-cumulative, but both are fully participating. The par value of all shares is ₱100. Requirements:C. Compute for the book value per share for: 5. Ordinary shares6.a. 5% Preference shares b. 7% Preference sharesProblem 2 The shareholders' equity of Tony Corporation revealed the following on June 30, 2018: Preference share, P100 par vale Preference share premium Ordinary share, P15 par value Ordinary share premium Ordinary share subscribed Retained earnings Notes payable Subscriptions receivable - ordinary P230,000 80,500 525,000 275,000 5,000 190,000 400,000 40,000 28. How much is the legal capital? 29. Using the data in problem #2, how much is the additional paid in capital? 30. Using the data in problem #2, how much is the total shareholders' equity? Problem 3 A corporation declared a 40% share dividend on its 60,000 shares of P20 par ordinary shares on a day when the market price is P50. 31. How much was debited to retained earnings on the date of declaration? 32. Using information in problem #3, what is the peso dividend per ordinary share? 33. Using information if problem #3 and assuming the share capital dividend declared is 4/40, what is the share premium from stock dividends?