rute Account12.00.90010.00.00031.00.00020.00.0005.40.000Accounting for Internal ReconstructionAssignmentsPRACTICAL ASSIGNMENTSThe following is the Balance Sheet of Weak Ltd. as at 31st March, 2022:1.Particulars1. EQUITY AND LIABILITIES1. Shareholders' Fund(a) Share Capital :- 10% Non-cumulative Preference Shares of 100 each fully paid-up- 20,000 Equity Shares of 10 each fully paid-up50,0002,00,000(b) Reserve and Surplus:Surplus A/c (Dr. Balance)(1,85,000)2. Non-Current Liabilities(a) Long-term Borrowings (8% Debentures)1,00,0003. Current Liabilities(a) Trade Payables (Creditors)3,30,000(b) Other Current Liabilities (Creditors for Expenses)Total20,0005,15,000II. ASSETS1.Non-current Assets(a) Property, Plant & Equipment Tangible: Buildings2,00,000Machinery1,30,000(b) Intangible (Patents)40,0002. Current Assets(a) Inventories80,000(b) Trade Receivables (Debtors)55,000(c) Other Current Assets (Preliminary Expenses)10,000Total5,15,000With a view to reconstruct the company, it is proposed:(a) to reduce (i) equity shares by 9 each, (ii) 10% preference shares by₹40 each. (iii) 8% Debentures70,000 and (vi) Inventoriesby 10%, (iv) Trade creditors' claims by one-third, (v) Machinery toby ₹ 10,000;(b) to provide * 15,000 for bad debts;(c) to write off all the intangible assets; and(d) to raise the rate of preference dividend to 13% and the rate of debenture interest to 13.5%.Assuming that the aforesaid proposals are duly approved and sanctioned, pass the journal entries togive effect to the above, and show the company' post-reconstruction balance sheet.[Ans. Balance Sheet total 3,80,000][B.Com. (Hons.) Delhi 1983]20.00.00020,00.0006,00,0008,40,0002,00,00040,000Cr.0,00000Note No.12.69

Reconstruction balance sheet is the balance sheet which as the name suggests which has been prepared…

Assuming that the aforesaid proposals are duly approved and sanctioned, pass the journal entries to give effect to the above, and show the company' post-reconstruction balance sheet. IR Cam (Hone olb: 10921

Assuming that the aforesaid proposals are duly approved and sanctioned, pass the journal entries to give effect to the above, and show the company' post-reconstruction balance sheet. IR Cam (Hone olb: 10921

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 85PSA: Common Dividends Fusion Payroll Service began 2019 with 1,200,000 authorized and 375,000 issued and...

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Common Dividends Fusion Payroll Service began 2019 with 1,200,000 authorized and 375,000 issued and outstand ing $5 par common shares. During 2019, Fusion entered into the following transactions: Declared a S0.30 per-share cash dividend on March 10. Paid the $0.30 per-share dividend on April 10. Repurchased 8,000 common shares at a cost of $18 each on May 2. Sold 1.500 unissued common shares for $23 per share on June 9. Declared a $0.45 per-share cash dividend on August 10. Paid the $0.45 per-share dividend on September 10. Declared and paid a 5% stock dividend on October 15 when the market price of the common stock was $25 per share. Declared a $0.50 per-share cash dividend on November 10. Paid the $0.50 per-share dividend on December 10. Required: Prepare journal entries for each of these transactions. (Note: Round to the nearest dollar.) Determine the total dollar amount of dividends (cash and stock) for the year. CONCEPTUAL CONNECTION Determine the effect on total assets and total stockholders equity of these dividend transactions.
CCC Company reported the following shareholders’ equity on December 31, 2020: Preference share capital, 12% P50 par 2,000,000 Ordinary share capital, P100 par 4,000,000 Retained earnings (deficit) (900,000) No dividends have been paid on the preference share since 2018. Questions: 1. Assuming that the preference share has preference as to dividends, compute for the book value per ordinary share. 2. Assuming that the preference share has preference as to dividends, compute for the book value per preference share.
The company capital structure consist of debt 340000 @ 4.05%, common stock 40% of preferred stock @ 9.09% and preferred stock 400000 @ 19.50%, calculate company’s weighted average cost of capital. Select one: a. 12.50% b. 11.79% c. 14.98% d. None of the option e. 13.15%
6. The following is a list of selected account balances taken from the December 31, 2021, general ledger of Selecta Corp. Account Payable 50,000 Accounts Receivable 45,500 Ordinary Share Capital 126,000 Paid in Capital in Excess of Par –Ordinary Share Capital 110,500 Paid in Capital in Excess of Par – Preferred Share Capital 10,250 Preference Share Capital 58,000 Preference Share capital Subscribed 6,000 Retained Earnings 20,500 Subscription Receivable –Preference 10,500 Compute first for the total paid-in capital then proceed to total stockholder’s equity for Selecta Corp. On December 31, 2021.
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1. Avalanche Inc. revealed the following information for the year ended December 31. 2021 Preference share. P100 par-P2.4 million; Share premium, preference - P700,000; Ordinary share, P15 par-P3.5 million, Share premium, ordinary-P1.5 million. Subscribed ordinary share - P100,000, Retained earnings - P2 million, Subscription receivable, ordinary - P20,000 How much is the legal capital? A.P6 million B.PB 1 million CP5.9 million D.P8 2 million 2.At the beginning of 2021, DAI Corp. was organized with authorized capital of 200,000, P500 par value shares. The following transactions transpired during its first year of business. February 4- Issued 15.000 shares at P510 per share April 10- Issued 3,000 shares for services received (FMV of the services is P1.7 million). October 23-Issued 5,000 shares in exchange for a land (FMV) the land is P3 million) What amount should be reported as share premium? A.11.500.000 B. 23.000 C.850.000 D.12.350.000 3. At the beginning of 2021, DAI Corp. was…
Macpie Prima Bhd. (MPB) was formed on 1 July 2000. The following data were taken from the Statement of Financial Position of MPB on 30 June 2018. RMShare capital – Ordinary 150,000,000 shares outstanding 277,500,000Retained earnings 98,523,150Fair value reserve 255,000 During the financial year 2019, the following transactions took place: 1. 120,000 ordinary shares were issued for cash on 15 August 2018 at RM2.30 per share. Transaction costs incurred were as follows:i) Legal fees RM10,500ii) Underwriters fees RM 8,200 2. MPB has followed a schedule of declaring cash dividends in December and June with payment being made to shareholders of record in the following month. The cash dividends declared since 2018 were shown below: Declaration Date Dividend15 June…
Macpie Prima Bhd. (MPB) was formed on 1 July 2000. The following data were taken from the Statement of Financial Position of MPB on 30 June 2018.RMShare capital – Ordinary 150,000,000 shares outstanding 277,500,000Retained earnings 98,523,150Fair value reserve 255,000 During the financial year 2019, the following transactions took place: 1. 120,000 ordinary shares were issued for cash on 15 August 2018 at RM2.30 per share. Transaction costs incurred were as follows:i) Legal fees RM10,500ii) Underwriters fees RM 8,200 2. MPB has followed a schedule of declaring cash dividends in December and June with payment being made to shareholders of record in the following month. The cash dividends declared since 2018 were shown below: Declaration Date Dividend15 June 2018 3 sen per share15 December 2018 2 sen per share15 June 2019 - No cash dividends were declared during June 2019 due to the company’s liquidity problem. 3. During the financial year 2019, fair value reserve decreased by RM47,000…
Item 13 refers to the following account. Appropriation Account $ $ Taxation reserve 10,000.00 By balance 894.50 Preliminary 250.00 Net profit 26,106.50 Transfer to general reserve 4,000.00 Preference share dividend 1,200.00 Ordinary share dividend 6,000.00 13. What conclusion could be drawn from the above appropriation account? i. The company is engaged in a profitable enterprise. ii. The company is not doing too well iii. More dividends can be given to the ordinary shareholders. a. I only c. II only b. I and III only d. II and III only
QUESTION TWO B plc has the following capital structure: K’000Ordinary shares – K0.40 5,000 Retained earnings 500 10% Preference shares at K1 1,500 10% K100 redeemable debentures 3,000 Total funds employed 10,000 The market price of the preference shares is 80n ex-div, the ordinary shares are quoted at K1.62 cum-div per share. Debenture stock is quoted at K97.5 ex-interest per K100 nominal and will be redeemable at par in exactly 7 years’ time. B plc has just declared dividend of K1,500,000 in total for all issued ordinary shares. The dividend growth rate is 4% per year forever. Company tax is 30% per year. The market rate of return is 12% and the company has an equity beta value of 1.25 Required:a) Calculate WACC based on market values. b) Discuss the implications of using a wrong WACC value in project appraisal and comment on the current level of capital gearing.
PQR SAOG has issued and paid up capital of OMR 2 million OMR 1 par value common stock. The current market price of each share is OMR 3. The company board decided a 4 for 1 stock split. The Market capitalization value of share after stock split should be a. 8,000,000 b. 2,000,000 c. 6,000,000 d. 4,000,000
Problem 6 (Adapted)Anna company presented the following account balances in the shareholders’ equity section for the year ended December 31, 2018: Preference share capital, 12% P50 par, P3,000,000, Ordinary share capital, P100 par, P6,000,000 and deficit, (P1,350,000). No dividends have been paid on the preference share since 2016. Determine the book value per share under the following conditions:a. Preference share is preferred as to assetsb. Preference share is preferred as to dividend