BOY Co. acquired 50,000 ordinary shares of GIRL Co. on September 30, 2019 forP8,250,000. On October 30, the shares were split into 2:1 (split-up). On November 30, 2020,Alto Co. distributed 10% ordinary share dividends when the market price of the share wasP250 per share. On December 31, 2020, BOY Co. sold 6,000 of its GIRL shares forP600,000. For the year ended December 31, 2020, how much should BOY report as gain onsale of investment?A. P105,000B. P150,000C. P200,000D. P250,000E. answer not givenWO Inc. acquired 50,000 ordinary shares of Lin Company at P120 per share. On February 14,2019, WO Inc. received 50,000 stock rights entitling it to buy one new share at P90 for everytwo rights held. On February 14, 2019, the market value of each share is P130 while that ofeach right is P20. On March 1, 2019, all the stock rights were exercised. If share rights areaccounted for separately, what is the total cost of the new investment in ordinary sharesacquired?A P2,250,000B. P3,050,000C. P3,250,000D. P5,500,000E. answer not givenABC Co. purchased 10,000 shares (2% ownership) of DEF Co on February 14, 2020.ABC Co. received a share dividend of 2,000 shares on April 30, 2020, when themarket value per share was P35. DEF Co. paid a cash dividend of P2 per share onDecember 15, 2020. In its 2020 income statement, what amount should ABC Co.report as dividend income?A. P20,000B. P24,000C. P90,000D. P94,000E. answer not given

1. Details of GIRLS Co. shares held by BOYS Co. before and after the share split. Date Cost of…

BOY Co. acquired 50,000 ordinary shares of GIRL Co. on September 30, 2019 for P8,250,000. On October 30, the shares were split into 2:1 (split-up). On November 30, 2020, Alto Co. distributed 10% ordinary share dividends when the market price of the share was P250 per share. On December 31, 2020, BOY Co. sold 6,000 of its GIRL shares for P600,000. For the year ended December 31 , 2020, how much should BOY report as gain on sale of investment?

BOY Co. acquired 50,000 ordinary shares of GIRL Co. on September 30, 2019 for P8,250,000. On October 30, the shares were split into 2:1 (split-up). On November 30, 2020, Alto Co. distributed 10% ordinary share dividends when the market price of the share was P250 per share. On December 31, 2020, BOY Co. sold 6,000 of its GIRL shares for P600,000. For the year ended December 31 , 2020, how much should BOY report as gain on sale of investment?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 5MC: Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par...

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Cary Corporation has 50,000 shares of 10 par common stock authorized. The following transactions took place during 2019, the first year of the corporations existence: Sold 5,000 shares of common stock for 18 per share. Issued 5,000 shares of common stock in exchange for a patent valued at 100,000. At the end of Carys first year, total contributed capital amounted to: a. 40,000 b. 90,000 c. 100,000 d. 190,000
Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par value common stock at 15 per share (400,000 shares were authorized). During the period January 1, 2014, through December 31, 2019, Kent reported net income of 750,000 and paid cash dividends of 380,000. On January 5, 2019, Kent purchased 12,000 shares of its common stock at 12 per share. On December 28, 2019, 8,000 treasury shares were sold at 8 per share. Kent used the cost method of accounting for treasury shares. What is Kents total shareholders equity as of December 31, 2019? a. 3,290,000 b. 3,306,000 c. 3,338,000 d. 3,370,000
Hyde Corporations capital structure at December 31, 2018, was as follows: On July 2, 2019, Hyde issued a 10% stock dividend on its common stock and paid a cash dividend of 2.00 per share on its preferred stock. Net income for the year ended December 31, 2019, was 780,000. What should be Hydes 2019 basic earnings per share? a. 7.80 b. 7.09 c. 7.68 d. 6.73
On January 1, 2019, Kittson Company had a retained earnings balance of 218,600. It is subject to a 30% corporate income tax rate. During 2019, Kittson earned net income of 67,000, and the following events occurred: 1. Cash dividends of 3 per share on 4,000 shares of common stock were declared and paid. 2. A small stock dividend was declared and issued. The dividend consisted of 600 shares of 10 par common stock. On the date of declaration, the market price of the companys common stock was 36 per share. 3. The company recalled and retired 500 shares of 100 par preferred stock. The call price was 125 per share; the stock had originally been issued for 110 per share. 4. The company discovered that it had erroneously recorded depreciation expense of 45,000 in 2018 for both financial reporting and income tax reporting. The correct depreciation for 2018 should have been 20,000. This is considered a material error. Required: 1. Prepare journal entries to record Items 1 through 4. 2. Prepare Kittsons statement of retained earnings for the year ended December 31, 2019.