At the current year end, Spurs Corporation declared 4,000 ordinary shares of P 100 par value in connection with a share capital dividend. The market value per share on the date of declaration was P 150.  The shareholder’s equity accounts immediately before issuance of the share capital dividend shares were as follows:           Ordinary share capital, P 100 par,50,000 shares authorized, 20,000 shares outstanding - P 2,000,000           Ordinary Share premium  -P3,000,000           Retained earnings  -P 1,500,000 What amount should be reported as retained earnings immediately after the share capital dividend?

Intermediate Accounting: Reporting And Analysis
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Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
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Chapter16: Retained Earnings And Earnings Per Share
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1.      At the current year end, Spurs Corporation declared 4,000 ordinary shares of P 100 par value in connection with a share capital dividend. The market value per share on the date of declaration was P 150.  The shareholder’s equity accounts immediately before issuance of the share capital dividend shares were as follows:
          Ordinary share capital, P 100 par,50,000 shares authorized, 20,000 shares outstanding - P 2,000,000
          Ordinary Share premium  -P3,000,000
          Retained earnings  -P 1,500,000
What amount should be reported as retained earnings immediately after the share capital dividend?

a. P2,100,000
b. P900,000
c. P1,100,000
d. P1,500,000

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