ABC Co holds 20,000 shares of XYZ Inc as investment in equity security measured at FVOCI. The investment has carrying amount of P500,000. On October 1, 20x1, ABC Co receives 20,000 stock rights to subscribe for new shares @ P10 per share for every 5 rights held. The fair value per stock right if P5. On November 2, 20x1 15,000 stock rights were sold @ 4 per right. On December 1, 20x1 remaining stock rights have expired. Requirement: Prepare Journal Entries on October 1, November 2 and December 1, 20x1.
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ABC Co holds 20,000 shares of XYZ Inc as investment in equity security measured at FVOCI. The investment has carrying amount of P500,000. On October 1, 20x1, ABC Co receives 20,000 stock rights to subscribe for new shares @ P10 per share for every 5 rights held. The fair value per stock right if P5.
On November 2, 20x1 15,000 stock rights were sold @ 4 per right.
On December 1, 20x1 remaining stock rights have expired.
Requirement:
Prepare
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- A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised all rights from the stock purchased March 20 before receiving 50% stock dividends on November 30. If on December 25, the BOD of XYZ declared P200 dividends per share, how much dividend your client is entitled to received on the date of payment? Rights are accounted for separately.A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20. If stock rights are not accounted for separately, how much is the loss if all stock rights were sold for P2.50 a right?A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20. If stock rights are not accounted for separately, how much is the increase in investments on March 20?
- A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 500 rights from the stock purchased March 20. If stock rights are not accounted for separately, determine the carrying value of the investments if 1/3 of the total holdings was sold for P75 a share. Round off answer to 2-decimal places.A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P70 for every five shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised all rights from the stock purchased March 20 which shall be accounted for separately. XYZ declared cash dividends of P100 per share by XYZ’s BOD to all shareholders however, your client has received ordinary shares of 300 when its fair value is P90. The carrying value of the investment at year-end will be (Rights are accounted for separately.)A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. Received stock rights permitting the purchase of one share at P70 for every five shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised all rights from the stock purchased March 20 before receiving 25% stock dividends on November 30. However, your client has received 300 preference shares instead of ordinary which your client agreed on. On this date, the market value of XYZ’s ordinary shares is P80 while P40 for its preference shares. The amount of investment in XYZ’s preference shares will be (round off % to 2 decimal places as well as your final answer and rights are accounted for separately.).
- 1. ABC Co purchases 10,000 XYZ Inc., shares for P100 per share on April 9, 20x1. On March 31, 20x1, XYZ Inc. declares cash dividend of P8 per share to shareholders of record on April 15, 20x1. The dividends will be distributed on April 31, 20x1. The investment is measured at FVPL. Requirement: Prepare Journal Entries on April 9 and April 30, 20x1. 2. ABC Co purchases 10,000 XYZ Inc. shares for P100 per share on April 27, 20x1. On March 31, 20x1, XYZ Inc. declares cash dividend of P8 per share to shareholders of record on April 15, 20x1. The dividends will be distributed on April 31, 20x1. The investment is measured at FVPL. Prepare Journal Entries on April 9 and April 30, 20x1. Requirement: Prepare Journal Entries on April 27 and April 30, 20x1. 3. ABC Co holds 10,000 shares of XYZ Inc. as Investment in equity securities. On April 1, 20x1, ABC Co receives land with accost of P1,000,000 and fair value of P1,300,000 as property dividend. Requirement: Prepare Journal Entries on April1. 4.…A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. On June 01, received a 50 percent stock dividend. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20, and sold the remaining rights at P4 each and on December 28, sold 400 shares from the stock purchased March 20, at P75, less broker’s fee of P1,000. After September 1 receipt of stock rights, what is the remaining cost of the investment? After the exercise and sale of stock rights, what is the remaining balance of investment? Stock rights are accounted for separately and use the average method.A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. On June 01, received a 50 percent stock dividend. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20, and sold the remaining rights at P4 each and on December 28, sold 400 shares from the stock purchased March 20, at P75, less broker’s fee of P1,000. After receipt of stock dividends, what is the new cost of investment per share? Stock rights are accounted for separately and use the average method.
- A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. On June 01, received a 50 percent stock dividend. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20, and sold the remaining rights at P4 each and on December 28, sold 400 shares from the stock purchased March 20, at P75, less broker’s fee of P1,000. After September 1 receipt of stock rights, what is the remaining cost of the investment? Stock rights are accounted separately and use average method.A client had the following investment transactions in 20X0: On March 20, purchased 1,000 shares of XYZ Co. ordinary shares at P80.50 plus broker’s fee of P500. On June 01, received a 50 percent stock dividend. Received stock rights permitting the purchase of one share at P60 for every four shares owned on September 1. On this date, the rights had a market price of P3 each, and the market price of the stock ex-right was P72 per share. On Nov. 10, exercised 1,000 rights from the stock purchased March 20, and sold the remaining rights at P4 each and on December 28, sold 400 shares from the stock purchased March 20, at P75, less broker’s fee of P1,000. After September 1 receipt of stock rights, what is the remaining cost of the investment?On March 31, 20x1, Budoy Co. received 10,000 stock rights from its investment in equity securities to subscribe to new shares at ₱60 per share for every 4 rights held. Prior to issuance of stock rights, the shares were selling at ₱80 per share. How much is the initial carrying amount of the stock rights?a. 20,000b. 40,000c. 50,000d. cannot be determined