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FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1. What amount of retained earnings should be appropriated as a result of the given transactions?

The following information pertains to IRON MAN Company: a. Dividends on its 50,000 shares of 10%, P100 par value cumulative preference share capital have not been declared or paid for 3 years. b. Treasury ordinary shares were acquired at a cost of P1,000,000 during the year. The treasury share had not been reissued as of year-end. At year-end, IRON MAN appropriated P3,000,000 of retained earnings for the construction of a new plant. d. Also, P2,000,000 of cash was restricted for the retirement of bonds payable due in the next year. C.
Transcribed Image Text:The following information pertains to IRON MAN Company: a. Dividends on its 50,000 shares of 10%, P100 par value cumulative preference share capital have not been declared or paid for 3 years. b. Treasury ordinary shares were acquired at a cost of P1,000,000 during the year. The treasury share had not been reissued as of year-end. At year-end, IRON MAN appropriated P3,000,000 of retained earnings for the construction of a new plant. d. Also, P2,000,000 of cash was restricted for the retirement of bonds payable due in the next year. C.
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