The following information are gathered from Relaxz Corporation: Relaxz Corporation’s charter became effective on January 2, 2015, when 80,000, P10 par value, ordinary shares and 40,000, 5% cumulative, nonparticipating, preference shares were issued. The ordinary shares were sold at P12 per share and the preference shares, at its par value of P100 per share.Relaxz was unable to pay preference dividends at the end of its first year. The owners of the preference shares agreed to accept 2 ordinary shares for every 50 shares of preference shares owned in lieu of the preference share dividends due on December 31, 2015. The shares were issued on January 2, 2018. The fairmarket value was P30 per share for ordinary share on the date of issue.On May 1, 2017, Relaxz sold 40,000 ordinary shares at par. Relaxz split its ordinary shares 3 for 2 on January 1, 2018, and 2 for 1 on January 1, 2019.The corporation offered to convert 20% of the preference shares to ordinary on the basis of 2 ordinary shares for 1 preference share. The offer was accepted, and the conversion was made on July 1, 2019. No cash dividends were declared on ordinary shares until December 31, 2017. Cash dividends per ordinary share were declared and paid as follows: December 31June 302017P4.0002018P5.00P3.002019P2.00P2.501. Compute for the amount of cash dividends declared and paid to ordinary shareholders for the year 2018. 2. Compute for the amount of cash dividends declared and paid to ordinary shareholders for the year 2019.

Dividend is the value of return received on shares by the shareholders from the company. 3 for 2…

Answered: hares and 40,000, 5% cumulative,…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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The following information are gathered from Relaxz Corporation:

Relaxz Corporation’s charter became effective on January 2, 2015, when 80,000, P10 par value, ordinary shares and 40,000, 5% cumulative, nonparticipating, preference shares were issued. The ordinary shares were sold at P12 per share and the preference shares, at its par value of P100 per share.
Relaxz was unable to pay preference dividends at the end of its first year. The owners of the preference shares agreed to accept 2 ordinary shares for every 50 shares of preference shares owned in lieu of the preference share dividends due on December 31, 2015. The shares were issued on January 2, 2018. The fair
market value was P30 per share for ordinary share on the date of issue.
On May 1, 2017, Relaxz sold 40,000 ordinary shares at par.
Relaxz split its ordinary shares 3 for 2 on January 1, 2018, and 2 for 1 on January 1, 2019.
The corporation offered to convert 20% of the preference shares to ordinary on the basis of 2 ordinary shares for 1 preference share. The offer was accepted, and the conversion was made on July 1, 2019.
No cash dividends were declared on ordinary shares until December 31, 2017. Cash dividends per ordinary share were declared and paid as follows:

	December 31	June 30
2017	P4.00	0
2018	P5.00	P3.00
2019	P2.00	P2.50

1. Compute for the amount of cash dividends declared and paid to ordinary shareholders for the year 2018.

2. Compute for the amount of cash dividends declared and paid to ordinary shareholders for the year 2019.

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