purchased for P120 perProblem 16-14 (AICPAtrading. These 50,000 shares wererights to the investor.and two of these rights.Each share had a market value of P130 and each right hadmarket value of P20 on the date of issue.aWhat total cost should be'recorded for the new shares thatare acquired by exercising the rights?a. 2,250,000b. 3,250,000c. 3,050,000d. 5,500,000

Introduction:- Shares are a type of equity ownership unit in a company. Shares exist as a financial…

Answered: Problem 16-14 (AIC) Temporal Company…

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

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 1MC

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Sun Corporation issues 500 shares of 8 par common stock for a patent. The stock is currently selling for 37 per share on the open market, and no significant impact on the market price is expected by the issuance of the additional shares. Prepare the journal entry to record this transaction.
Pedantic Co. purchased 20,000 shares on 1 July 20x0, making the election to use the alternative treatment under FVTOCI – IFRS 9. Given that each share costs $3.50. Transaction costs of the purchase were $400. At 31 December 20x0, the shares are trading at $5.0 each. a. What is the carrying balance of this financial asset shown on statement of financial position as at 31 December 20X0? b. What is the gain to be recognised on these shares for the year ended 31 December 20X0? Where to record this gain in statement of profit or loss and other comprehensive? c. Assume that these shares were held for sales, what is the initial measurement of this financial asset at 01 July 20x0? What should Pedantic Co record in statement of profit or loss and other comprehensive income at the year ended 20X0?
JKL:o. issued 20,000 shares of its P25 par value ordinary shares and 4,000 shares of its P50 par value preference shares for a total of P350,000 cash and an equipment with acquisition cost of P900, 000, book value of P450, 000 and fair value of P500, 000. On that date, the fair value of ordinary shares is P30. How much is allocated to the preference shares?
Coporation completed the following transactions realting to investment in other company ordinary shares which were acuired for trdaing purposes2019 Purchased 1000 shares at 150 per share plus transaction costs of 3750 At year end other company ordinary share had a fair value of 180 per share 2020 sold 500 of other company ordinary shares for a total of 94000 at year end FV of each share was 192 On date of purchase of the invcestmebnt, the amount debited to asset account is?the total net amunt reported in 2019 profit or loss is? ]the current assets at dec 31 20919 will report the value investment at? The total amount reported in 2020 profit and loss is? the total amount reported in 2020 OCI is?
#18In 2020, Edsel Company issued for P210 per share, 24,000 shares of P100 par valueconvertible preference share capital. One preference share can be converted into threeordinary shares of Eden’s P30 par value at the option of the shareholder. In August 2020, all ofthe preference shares were converted into ordinary shares. The market value of the ordinaryshare on the date of conversion was P60 per share. What amount will be credited to sharepremium? 2,880,000 pls provide correct solution for the given answer
Aira Company issued rights to subscribe to its stock, the ownership of 4 shares entitling the shareholders to subscribe for 1 share at P100. An investor owned 50,000 shares with total cost of P5,000,000. The share is quoted right-on at 125. The stock rights are accounted for separately and measured initially at fair value. What is the cost of the new investment assuming all of the stock rights are exercised by the investor?
On April 5. 2023, Paul Company purchased P50 par, 10,000 ordinary shares of George Company at P80 per share. The shares are designated as equity investments at Fair value through other comprehensive income. On October 26, 2023, Paul received 10,000 rights to purchase an additional 2,000 shares at P90 per share. The share rights received had an expiration date of February 1, 2024. 12. Assuming that all of the share rights are exercised, at which time the market value per ordinary share was P98, what Is the total cost of the new Investment arising from the exercise of these rights? a. P196,000 b. P180,000 c. P160,000 d. P100,000 13. Refer to number 12, how much investment income should be recorded by Paul? a. P36,000b. P16,000c. P8,000d. P0
On April 5. 2020, Paul Company purchased P50 par, 10,000 ordinary shares of George Company at P80 per share. The shares are designated as equity investments at Fair value through other comprehensive income. On October 26, 2020, Paul received 10,000 rights to purchase an additional 2,000 shares at P90 per share. The share rights received had an expiration date of February 1, 2021.1. How much is the income recognized upon receipt of share rights? a. P0 b. P10,000 c. P20,000 d. P 80,000 2. How much is the investment Income, assuming that all of the share rights are sold at its market value of P5 each? a. P50,000 b. P20,000 c. P10,000 d. P0

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