1. Prepare the journal entries to record the transactions. 2. Prepare the statement of retained earnings for the year ended June 30, 2018. 3. Prepare the shareholders' equity section of the statement of financial position as at June 30, 2018.
1. Prepare the journal entries to record the transactions. 2. Prepare the statement of retained earnings for the year ended June 30, 2018. 3. Prepare the shareholders' equity section of the statement of financial position as at June 30, 2018.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem #28
Comprehensive Shareholders' Equity Transactions
The shareholders' equity of the Rodriguez Corporation on June 30, 2017, is shown
below:
Share Capital
Ordinary Shares- P6 par value,
1,000,000 shares authorized,
250,000 shares issued and outstanding
Share Premium-Ordinary
Total Share Capital
P1,500,000
820,000
P2,320,000
970,000
Retained Earnings
Total Shareholders' Equity
P3,290,000
Transactions for the next fiscal year were as follows:
The board of directors declared a 2-for-1 share split.
The board of directors obtained authorization to issue 50,000 shares of P100 par
value, 6 % non-cumulative preference shares.
Issued 12,000 ordinary shares for a building appraised at P96,000.
Purchased 8,0000 shares of the corporation's ordinary shares for P64,000.
Issued 20,000 preference shares for P100 per share.
f. Sold 5,000 shares of treasury stock for P35,000.
Declared cash dividends of P6 per share on preference shares and P.20 per share
a.
b.
с.
d.
e.
g.
on ordinary shares.
h. Date of record.
i. Paid the preference and ordinary shares cash dividends.
Declared a 10% share dividend on ordinary shares. The market value was P10 per
j.
share. The share dividend is distributable after the end of the fiscal year.
Profit for the year was P340,000.
k.
Required:
1. Prepare the journal entries to record the transactions.
2. Prepare the statement of retained earnings for the year ended June 30, 2018.
3. Prepare the shareholders' equity section of the statement of financial position as at
June 30, 2018.
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