1. Determine the total retained earnings as of December 31, 2020.choices:780,000858,000580,500730,5002. Determine the total share premium as of December 31, 2020.8,396,9508,419,4508,402,8008,219,650 The equity section of the Georgie Inc. showed the following data on December 31, 2019:Share capital, P3 par, 300,000 shares authorized, 250,000 shares issued and outstanding,P750,000; Share premium excess over par, P7,050,000; Share premium - share options,P150,000; Retained earnings, P480,000. The share options were granted to key executivesand provided them the right to acquire 30,000 ordinary shares at P30 per share. Eachoption has a fair value of P5 at the time the options were granted.The following transactions occurred during 2020:Feb. 1Apr. 1Jul.1Oct. 1Dec.1Key executives exercised 4,500 options outstanding at December 31, 2019. The marketprice per share was P44 at this time.The company issued bonds of P2,000,000 at par, giving each P1,000 bond a detachablewarrant enabling the holder to purchase two ordinary shares at P40 each for a 1-yearperiod. The bonds would sell at P996 per P1,000 bond without the warrant.The company issued rights to shareholders (one right on each share, exercisable within a30-day period) permitting holders to acquire one share at P40 with every 10 rightssubmitted. All but 6,000 rights were exercised on July 31, and the additional shares wereissued.All warrants issued in connection with the bonds on April 1 were exercised.The market price per share dropped to P33 and options came due. Because the marketprice was below the option price, no remaining options were exercised.

Journal entries: These are the entries prepared to record the business transactions in the books of…

The equity section of the Georgie Inc. showed the following data on December 31, 2019: Share capital, P3 par, 300,000 shares authorized, 250,000 shares issued and outstanding, P750,000; Share premium excess over par, P7,050,000; Share premium - share options, P150,000; Retained earnings, P480,000. The share options were granted to key executives and provided them the right to acquire 30,000 ordinary shares at P30 per share. Each option has a fair value of P5 at the time the options were granted. The following transactions occurred during 2020:

The equity section of the Georgie Inc. showed the following data on December 31, 2019: Share capital, P3 par, 300,000 shares authorized, 250,000 shares issued and outstanding, P750,000; Share premium excess over par, P7,050,000; Share premium - share options, P150,000; Retained earnings, P480,000. The share options were granted to key executives and provided them the right to acquire 30,000 ordinary shares at P30 per share. Each option has a fair value of P5 at the time the options were granted. The following transactions occurred during 2020:

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

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 26P

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