Worldwide Company was authorized to issue 10,000 preference shares of P200 par value and 100,000 ordinary shares of P20 par value. Subscription for 4,000 preference shares was received at P225 per share with a down payment of 25%. The balance is payable after 60 days. 16. What is the amount of Share Premium - Preference recognized by Worldwide upon receipt of the preference share subscription?
Worldwide Company was authorized to issue 10,000 preference shares of P200 par value and 100,000 ordinary shares of P20 par value. Subscription for 4,000 preference shares was received at P225 per share with a down payment of 25%. The balance is payable after 60 days. 16. What is the amount of Share Premium - Preference recognized by Worldwide upon receipt of the preference share subscription?
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter20: Corporations: Organization And Capital Stock
Section: Chapter Questions
Problem 8SPA: STOCK SUBSCRIPTIONS Juneau Associates had the following stock transactions during the year: (a)...
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Question
For number 16, which one is correct for my answer?
Answer A:
|
Amount received (4,000 x P225 x 25%) |
P225,000 |
|
at par value (4,000 x P200 x 25%) |
P200,000 |
|
Share premium |
P25,000 |
only those which are paid, are recognized.
Answer B:
Issue price (4,000 x 225) 900,000
Share premium (APIC) 100,000
Please explain to me which one is the correct answer.
Transcribed Image Text:I.
Worldwide Company was authorized to issue 10,000 preference shares of
P200 par value and 100,000 ordinary shares of P20 par value. Subscription
for 4,000 preference shares was received at P225 per share with a down
payment of 25%. The balance is payable after 60 days.
16. What is the amount of Share Premium - Preference
recognized by Worldwide upon receipt of the
preference share subscription?
J.
authorized share capital of P3,000,000 divided into 100,000 shares of P30
par. In February, 30,000 shares were sold for P40 per share. In March,
20,000 shares were sold on a subscription basis at a price of P45 per share.
As of December 31, 2018, one-half of the subscriptions in March was
collected.
On January 31, 2018, Mendoza Corporation was incorporated with an
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