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You are engaged to perform the first audit of the Torrents Company for the year ended December 31, 2022. You find the following account balances related to shareholders' equity:
| P3,000,000 | |
| Ordinary Shares, P10 par | 6,500,000 |
| Capital Surplus | (1,640,000) |
| Retained Earnings | 15,000,000 |
Due to the antiquated terminology and negative balance, you examine the Capitak Surplus account first and find in it the following entries:
| Credit/(Debit) | |
| Premium on Ordinary Shares | P2,710,000 |
| Capital from donated land | 1,600,000 |
| Treasury shares (50,000 ordinary shares at cost) | (750,000) |
| Premium on Preference Shares | 300,000 |
| Appropriation for contingencies | 2,500,000 |
| Share dividend issued (50%) | (2,000,000) |
| Prior period adjustment (net of income taxes) | (1,200,000) |
| Loss from the fire (uninsured), 2022 | (1,800,000) |
| Property dividend distributed | (600,000) |
| Cash dividends declared to be paid in 2023 | (2,400,000) |
| Balance | (P1,640,000) |
Your examination of the Preference Shares and Ordinary Shares accounts reveals that the amounts shown correctly state the total par value of the issued share capital. The Retained Earnings account contains the
1. The compound
2. The total appropriated retained earnings is
3. The unappropriated retained earnings is
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- You’ve been hired to perform an audit of Hubbard Company for the year ended December 31, 2019. You find the following account balances related to shareholders’ equity: Preferred stock, $100 par $ 33,000 Common stock, $10 par 68,000 Capital surplus (15,100) Retained earnings 172,000 Because of the antiquated terminology and negative balance, you examine the Capital Surplus account and find the following entries: Credit (Debit) Additional paid-in capital on common stock $ 27,700 Capital from donated land 16,900 Treasury stock (400 common shares at cost) (5,600) Additional paid-in capital on preferred stock 2,000 Stock dividend (50%) (20,000) Prior period adjustment (net of income taxes) (10,100) Loss from fire (uninsured), 2018 (18,100) Property dividend declared (5,600) Cash dividends declared (23,300) Balance $ (36,100) Your examination of the Preferred Stock and Common Stock accounts reveals that the amounts shown correctly state the…You’ve been hired to perform an audit of Hubbard Company for the year ended December 31, 2019. You find the following account balances related to shareholders’ equity: Preferred stock, $100 par $ 33,000 Common stock, $10 par 68,000 Capital surplus (15,100) Retained earnings 172,000 Because of the antiquated terminology and negative balance, you examine the Capital Surplus account and find the following entries: Credit (Debit) Additional paid-in capital on common stock $ 27,700 Capital from donated land 16,900 Treasury stock (400 common shares at cost) (5,600) Additional paid-in capital on preferred stock 2,000 Stock dividend (50%) (20,000) Prior period adjustment (net of income taxes) (10,100) Loss from fire (uninsured), 2018 (18,100) Property dividend declared (5,600) Cash dividends declared (23,300) Balance $ (36,100) Your examination of the Preferred Stock and Common Stock accounts reveals that the amounts shown correctly state the…You are internal auditor for Shannon Supplies, Incorporated, and are reviewing the company's preliminary financial statements. The statements, prepared after making the adjusting entries, but before closing entries for the year ended December 31, 2024, are as follows: Assets Cash SHANNON SUPPLIES, INCORPORATED Balance Sheet December 31, 2024 ($ in thousands) Investment in equity securities Accounts receivable, net Inventory Equipment Less: Accumulated depreciation Total assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Income tax payable Common stock, $1 par Additional paid-in capital Retained earnings Total liabilities and shareholders' equity Net income SHANNON SUPPLIES, INCORPORATED Income Statement For the Year Ended December 31, 2024 ($ in thousands) Sales revenue Operating expenses: Cost of goods sold Selling and administrative Depreciation Income before income tax Income tax expense $ 1,240 906 74 $ 3,700 2,220 $ 1,480 (370) $ 1,110 $ 2,500 350…
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