hares 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
hares 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
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
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.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
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.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education