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JOURNALIZING McAllister Co.'s shareholders' equity on December 31, 2020 shows the following accounts and balances: Preference share capital, P20 par Ordinary share capital, P5 par Share premium - preference Share premium - ordinary Retained earnings P 2,000,000 8,000,000 5,000,000 12,000,000 10,000,000 The following transactions occurred in 2021: January 31 Issued 100,000 preference shares at P25 per share Issued 200,000 ordinary shares, receiving 1,600,000 Issued 50,000 preference shares and 125,000 ordinary shares, receiving P3,600,000. March 31 The fair value of each preference share and each ordinary share on this date was P30 and P20, respectively. Issued 20,000 ordinary shares. These shares were issued at P27 per share. Issued P10,000,000, five-year, 12% convertible bonds at 103. Without the conversion April 30 June 30 option, the bonds would be sold at par. Each P1,000 bond is convertible into 150 ordinary shares. September 30 Received a unit of equipment and a set of furniture and fixtures by issuing 20,000 preference shares. The fair values of the equipment and the furniture on this date were P700,000 and P300,000, respectively. McAllister's preference shares have a fair value of P32 on this date October 31 A shareholder donated 100,000 ordinary shares, when the shares were trading at P22. The shares were sold by McAllister the next day at P25 per share 40% of the bonds issued on June 30 were converted into shares Net income during the year was P2,000,000 November 30 December 31 1. Prepare the necessary journal entries in 2021. 2. Determine the balances of the following as of December 31, 2021: a. Preference share capital b. Ordinary share capital c. Total share premium d. Total shareholders' equity

JOURNALIZING McAllister Co.'s shareholders' equity on December 31, 2020 shows the following accounts and balances: Preference share capital, P20 par Ordinary share capital, P5 par Share premium - preference Share premium - ordinary Retained earnings P 2,000,000 8,000,000 5,000,000 12,000,000 10,000,000 The following transactions occurred in 2021: January 31 Issued 100,000 preference shares at P25 per share Issued 200,000 ordinary shares, receiving 1,600,000 Issued 50,000 preference shares and 125,000 ordinary shares, receiving P3,600,000. March 31 The fair value of each preference share and each ordinary share on this date was P30 and P20, respectively. Issued 20,000 ordinary shares. These shares were issued at P27 per share. Issued P10,000,000, five-year, 12% convertible bonds at 103. Without the conversion April 30 June 30 option, the bonds would be sold at par. Each P1,000 bond is convertible into 150 ordinary shares. September 30 Received a unit of equipment and a set of furniture and fixtures by issuing 20,000 preference shares. The fair values of the equipment and the furniture on this date were P700,000 and P300,000, respectively. McAllister's preference shares have a fair value of P32 on this date October 31 A shareholder donated 100,000 ordinary shares, when the shares were trading at P22. The shares were sold by McAllister the next day at P25 per share 40% of the bonds issued on June 30 were converted into shares Net income during the year was P2,000,000 November 30 December 31 1. Prepare the necessary journal entries in 2021. 2. Determine the balances of the following as of December 31, 2021: a. Preference share capital b. Ordinary share capital c. Total share premium d. Total shareholders' equity

Cornerstones of Financial Accounting
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 84PSA: Statement of Stockholders' Equity At the end of 2019, Stanley Utilities Inc. had the following...
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JOURNALIZING McAllister Co.'s shareholders' equity on December 31, 2020 shows the following accounts and balances: Preference share capital, P20 par P 2,000,000 Ordinary share capital, P5 par 8,000,000 Share premium - preference 5,000,000 Share premium - ordinary 12,000,000 Retained earnings 10,000,000 The following transactions occurred in 2021: January 31 Issued 100,000 preference shares at P25 per share Issued 200,000 ordinary shares, receiving 1,600,000 March 31 Issued 50,000 preference shares and 125,000 ordinary shares, receiving P3,600,000. The fair value of each preference share and each ordinary share on this date was P30 and P20, respectively. Issued 20,000 ordinary shares. These shares were issued at P27 per share. Issued P10,000,000, five-year, 12% convertible bonds at 103. Without the conversion April 30 June 30 option, the bonds would be sold at par. Each P1,000 bond is convertible into 150 ordinary shares. September 30 Received a unit of equipment and a set of furniture and fixtures by issuing 20,000 preference shares. The fair values of the equipment and the furniture on this date were P700,000 and P300,000, respectively. McAllister's preference shares have a fair value of P32 on this date October 31 A shareholder donated 100,000 ordinary shares, when the shares were trading at P22. The shares were sold by McAllister the next day at P25 per share November 30 40% of the bonds issued on June 30 were converted into shares December 31 Net income during the year was P2,000,000 1. Prepare the necessary journal entries in 2021. 2. Determine the balances of the following as of December 31, 2021: a. Preference share capital b. Ordinary share capital C. Total share premium d. Total shareholders' equity
Transcribed Image Text:JOURNALIZING McAllister Co.'s shareholders' equity on December 31, 2020 shows the following accounts and balances: Preference share capital, P20 par P 2,000,000 Ordinary share capital, P5 par 8,000,000 Share premium - preference 5,000,000 Share premium - ordinary 12,000,000 Retained earnings 10,000,000 The following transactions occurred in 2021: January 31 Issued 100,000 preference shares at P25 per share Issued 200,000 ordinary shares, receiving 1,600,000 March 31 Issued 50,000 preference shares and 125,000 ordinary shares, receiving P3,600,000. The fair value of each preference share and each ordinary share on this date was P30 and P20, respectively. Issued 20,000 ordinary shares. These shares were issued at P27 per share. Issued P10,000,000, five-year, 12% convertible bonds at 103. Without the conversion April 30 June 30 option, the bonds would be sold at par. Each P1,000 bond is convertible into 150 ordinary shares. September 30 Received a unit of equipment and a set of furniture and fixtures by issuing 20,000 preference shares. The fair values of the equipment and the furniture on this date were P700,000 and P300,000, respectively. McAllister's preference shares have a fair value of P32 on this date October 31 A shareholder donated 100,000 ordinary shares, when the shares were trading at P22. The shares were sold by McAllister the next day at P25 per share November 30 40% of the bonds issued on June 30 were converted into shares December 31 Net income during the year was P2,000,000 1. Prepare the necessary journal entries in 2021. 2. Determine the balances of the following as of December 31, 2021: a. Preference share capital b. Ordinary share capital C. Total share premium d. Total shareholders' equity
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