McDo Co. reported the following amounts in the shareholders’ equity section of its December 31, 2021 balance sheet: Preference shares, P10 par (100,000 shares authorized, 40,000 shares outstanding) P400,000 Ordinary shares, P5 par (50,000 shares authorized, 20,000 shares outstanding) 100,000 Share premium – PS 112,000 Share premium – OS 80,000 Accumulated profits 1,200,000 The following occurred during 2021: a. Paid the annual 2021P1.00 per share dividend on preference share and P0.50 per share dividend on Ordinary shares. No entry had been made on December 29, 2021. b. Purchased 4,000 shares of its own outstanding ordinary shares for P80,000 c. Declared a 4 for 1 reverse split on its ordinary shares d. Reissued 350 treasury shares for an equipment with a fair value at P50,000 e. Issued 10,000 shares of preference shares at P15 per share f. Declared a 10% stock dividend on the outstanding ordinary shares when the stock is selling for P48 per share g. Issued the share dividend h. Retired 150 ordinary shares in the treasury i. Declared the annual P1 dividend on preference shares and the P2 per share dividend on ordinary shares. These dividends are payable in 2023. j. Registered a net income at P940,000 Determine the adjusted balance of the ff. accounts: d. Treasury shares e. Retained earnings, unappropriated
McDo Co. reported the following amounts in the shareholders’ equity section of its
December 31, 2021 balance sheet:
Preference shares, P10 par (100,000 shares authorized, 40,000 shares outstanding) P400,000
Ordinary shares, P5 par (50,000 shares authorized, 20,000 shares outstanding) 100,000
Share premium – PS 112,000
Share premium – OS 80,000
The following occurred during 2021:
a. Paid the annual 2021P1.00 per share dividend on
b. Purchased 4,000 shares of its own outstanding ordinary shares for P80,000
c. Declared a 4 for 1 reverse split on its ordinary shares
d. Reissued 350 treasury shares for an equipment with a fair value at P50,000
e. Issued 10,000 shares of preference shares at P15 per share
f. Declared a 10% stock dividend on the outstanding ordinary shares when the stock is selling for P48 per share
g. Issued the share dividend
h. Retired 150 ordinary shares in the treasury
i. Declared the annual P1 dividend on preference shares and the P2 per share dividend on ordinary shares. These dividends are payable in 2023.
j. Registered a net income at P940,000
Determine the adjusted balance of the ff. accounts:
d. Treasury shares
e. Retained earnings, unappropriated
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