6. The shareholders' equity of Stormy Co. is as follows:Shareholders' equity, P100 parShare premiumRetained earningsTotal shareholders' equity2,000,000400,000600,0003,000,000Stormy Co. reduces the par value per share to P80.Requirement: Prepare the shareholders' equity of Stormy Co. afterthe recapitalization.

If the par value of shares has been reduced, the excess in total par value should be credited to…

Answered: shareholders' equity

Business

Accounting

shareholders' equity

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 12MCQ

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Question

6. The shareholders' equity of Stormy Co. is as follows:
Shareholders' equity, P100 par
Share premium
Retained earnings
Total shareholders' equity
2,000,000
400,000
600,000
3,000,000
Stormy Co. reduces the par value per share to P80.
Requirement: Prepare the shareholders' equity of Stormy Co. after
the recapitalization.

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