Cash dividend during 2016 on the P10 par value ordinary share of Keira Company were as follows:3rd quarter4th quarter1st quarterP800,000P1,000,0002nd quarter900,0001,100,000The 4th quarter cash dividend was declared on December 20,2016 to shareholders of record onDecember 31,2016, payable on January 9,2017. In addition, Keira declared a 5% share dividend on itsP10 par value ordinary share on December 1,2016 when there were 300,000 shares issued andoutstanding and the market value of share 1s P20 per share. On the declaration date and P25 ondistribution date. The share were issued on December 21,2016. What was the effect on shareholders'equity accounts as a result of the foregoing transactions?Ordinary shareShare PremiumRetained EarningsP3,800,000 debit4,175,000 debitа.zerozerob.P150,000 creditP150,000 creditP300,000 creditP225,000 creditP150,000 creditC.4,100,000 debitd.P300,000 credit3,800,000 debit

Total Cash Dividend for the Year = (800000+900000+1000000+1100000) = 3800000 Add : Stock…

1* quarter P800,000 2nd quarter 900,000 The 4th quarter cash dividend was December 31,2016, payable on Ja P10 par value ordinary share on putstanding and the market valu distribution date. e The share wer

1* quarter P800,000 2nd quarter 900,000 The 4th quarter cash dividend was December 31,2016, payable on Ja P10 par value ordinary share on putstanding and the market valu distribution date. e The share wer

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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Question

Cash dividend during 2016 on the P10 par value ordinary share of Keira Company were as follows:
3rd quarter
4th quarter
1st quarter
P800,000
P1,000,000
2nd quarter
900,000
1,100,000
The 4th quarter cash dividend was declared on December 20,2016 to shareholders of record on
December 31,2016, payable on January 9,2017. In addition, Keira declared a 5% share dividend on its
P10 par value ordinary share on December 1,2016 when there were 300,000 shares issued and
outstanding and the market value of share 1s P20 per share. On the declaration date and P25 on
distribution date. The share were issued on December 21,2016. What was the effect on shareholders'
equity accounts as a result of the foregoing transactions?
Ordinary share
Share Premium
Retained Earnings
P3,800,000 debit
4,175,000 debit
а.
zero
zero
b.
P150,000 credit
P150,000 credit
P300,000 credit
P225,000 credit
P150,000 credit
C.
4,100,000 debit
d.
P300,000 credit
3,800,000 debit

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