Homework Help is Here – Start Your Trial Now!
Business
Accounting
Fuentes Corporation: Preference P9 Shares, P100 par, 10,0 authorized, 5,000 shares issued Share Premium-Preference Ordinary Shares, P20 par, 100,000 sh 75.000 shares issued

Fuentes Corporation: Preference P9 Shares, P100 par, 10,0 authorized, 5,000 shares issued Share Premium-Preference Ordinary Shares, P20 par, 100,000 sh 75.000 shares issued

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
Share Issuances for Cash and Non-Cash Considerations Problem #13 0n Jan. 1, 2018, the following accounts and their balances appeared in the ledger of Fuentes Corporation: Preference P9 Shares, P100 par, 10,000 shares authorized, 5,000 shares issued Share Premium-Preference Ordinary Shares, P20 par, 100,000 shares authorized, 75,000 shares issued Share Premium-Ordinary Retained Earnings P 500,000 80,000 1,500,000 125,000 505,000 At the annual shareholders' meeting on Feb. 11, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately P600,000. The plan provided (a) that the corporation borrow P175,000, (b) that 1,000 shares of the unissued preference shares be issued through an underwriter, and (c) that a building valued at P280,000, and the land on which it is located, valued at P50,000, be acquired in accordance with preliminary negotiations by the issuance of 15,000 ordinary shares. The plan was approved by the shareholders and accomplished by the following transactions: Issued 15,000 ordinary shares in exchange for land and a building, according to the plan. Mar. 3 Issued 1,000 preference shares, receiving P105 per share in cash from the underwriter. 15 31 Borrowed P175,000 from Philippine National Bank, giving a 12% mortgage note. No other transactions occurred during March. Required: 1. Journalize the entries to record the foregoing transactions. 2. Prepare the shareholders' equity section of the statement of financial position as at March 31, 2018. Shot on Y15
Transcribed Image Text:Share Issuances for Cash and Non-Cash Considerations Problem #13 0n Jan. 1, 2018, the following accounts and their balances appeared in the ledger of Fuentes Corporation: Preference P9 Shares, P100 par, 10,000 shares authorized, 5,000 shares issued Share Premium-Preference Ordinary Shares, P20 par, 100,000 shares authorized, 75,000 shares issued Share Premium-Ordinary Retained Earnings P 500,000 80,000 1,500,000 125,000 505,000 At the annual shareholders' meeting on Feb. 11, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately P600,000. The plan provided (a) that the corporation borrow P175,000, (b) that 1,000 shares of the unissued preference shares be issued through an underwriter, and (c) that a building valued at P280,000, and the land on which it is located, valued at P50,000, be acquired in accordance with preliminary negotiations by the issuance of 15,000 ordinary shares. The plan was approved by the shareholders and accomplished by the following transactions: Issued 15,000 ordinary shares in exchange for land and a building, according to the plan. Mar. 3 Issued 1,000 preference shares, receiving P105 per share in cash from the underwriter. 15 31 Borrowed P175,000 from Philippine National Bank, giving a 12% mortgage note. No other transactions occurred during March. Required: 1. Journalize the entries to record the foregoing transactions. 2. Prepare the shareholders' equity section of the statement of financial position as at March 31, 2018. Shot on Y15
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Accounting for stockholder's equity
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS