Little Shark Gaming Company, a publicly listed company, has just started operating as a digital gaming developer in the Philippines in 2021. As a new personnel under the accounting department, you were tasked by the manager to account for the transactions related to the stockholder's equity and prepare the same for the calendar year ended December 31, 2021. Aside from the list of transactions, the following information are also provided to you: 1. The company is authorized to issue 100,000, Php100 par ordinary shares and 10,000 preference shares with par value of Php500 per share. 2. Net income for the year was Php1,500,000. 3. The cost method is used to account for treasury share transactions. The following transactions occurred in 2021: Date Transaction January 10 February 28 Issued 20,000 ordinary shares for Php3 million Issued another 10,000 ordinary shares at Php100 March 11 Issued 8,000 ordinary shares in exchange for a used vehicle. The fair value of the vehicle is not known but at the time of exchange, the current market value of the shares is at Php105 per share. Issued 5,000 preference shares for Php2,650,000 March 24 May 10 June 15 July 30 Purchased 12,000 treasury ordinary shares for Php115 per share Sold 4,000 shares of the treasury shares for Php120 per share Sold another 5,000 shares of treasury shares for Php110 per share Requirements: a) Prepare all the journal entries for 2021. b) Prepare the equity section of the Statement of Financial Position for the company's first year of operations.
Little Shark Gaming Company, a publicly listed company, has just started operating as a digital gaming developer in the Philippines in 2021. As a new personnel under the accounting department, you were tasked by the manager to account for the transactions related to the stockholder's equity and prepare the same for the calendar year ended December 31, 2021. Aside from the list of transactions, the following information are also provided to you: 1. The company is authorized to issue 100,000, Php100 par ordinary shares and 10,000 preference shares with par value of Php500 per share. 2. Net income for the year was Php1,500,000. 3. The cost method is used to account for treasury share transactions. The following transactions occurred in 2021: Date Transaction January 10 February 28 Issued 20,000 ordinary shares for Php3 million Issued another 10,000 ordinary shares at Php100 March 11 Issued 8,000 ordinary shares in exchange for a used vehicle. The fair value of the vehicle is not known but at the time of exchange, the current market value of the shares is at Php105 per share. Issued 5,000 preference shares for Php2,650,000 March 24 May 10 June 15 July 30 Purchased 12,000 treasury ordinary shares for Php115 per share Sold 4,000 shares of the treasury shares for Php120 per share Sold another 5,000 shares of treasury shares for Php110 per share Requirements: a) Prepare all the journal entries for 2021. b) Prepare the equity section of the Statement of Financial Position for the company's first year of operations.
Chapter3: Analyzing And Recording Transactions
Section: Chapter Questions
Problem 16EA: Discuss how each of the following transactions for Watson, International, will affect assets,...
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Transcribed Image Text:Little Shark Gaming Company, a publicly listed company, has just started operating as a digital
gaming developer in the Philippines in 2021. As a new personnel under the accounting
department, you were tasked by the manager to account for the transactions related to the
stockholder's equity and prepare the same for the calendar year ended December 31, 2021.
Aside from the list of transactions, the following information are also provided to you:
1. The company is authorized to issue 100.000, Php100 par ordinary shares and 10,000
preference shares with par value of Php500 per share.
2. Net income for the year was Php1,500,000.
3. The cost method is used to account for treasury share transactions.
The following transactions occurred in 2021:
Date
Transaction
Issued 20.000 ordinary shares for Prip3 million
January 10
February 28
Issued another 10,000 ordinary shares at Php100
March 11
Issued 8,000 ordinary shares in exchange for a used vehicle. The fair
value of the vehicle is not known but at the time of exchange, the
current market value of the shares is at Php105 per share.
Issued 5.000 preference shares for Php2,650 000
March 24
May 10
June 15
July 30
Purchased 12.000 treasury ordinary shares for Php115 per share
Sold 4.000 shares of the treasury shares for Pho120 per share
Sold another 5,000 shares of teasury shares for Php110 per share
Requirements:
a) Prepare all the journal entries for 2021.
b) Prepare the equity section of the Statement of Financial Position for the
company's first year of operations.
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