5. What is the correct balance of ordinary share capital on December 31, 2021? You have been assigned to audit RUDOLPH Company. You are asked to summarize the transactions for the year ended December 31, 2021 affecting shareholders' equity and other related accounts. The Shareholders' Equity section of RUDOLPH's December 31, 2020 Statement of Financial Position had the following balances: Ordinary share capital, 2 par value, 1,000,000 shares authorized, 180,000 shares issued, 177,580 shares outstanding Share premium - issuance Share premium - treasury shares Retained earnings Cost of 2,420 treasury shares Total shareholders' equity 360,000 3,640,000 45,000 649,378 (145,200) P4,549,178 D You have extracted the following information from the accounting records and audit working papers:
5. What is the correct balance of ordinary share capital on December 31, 2021? You have been assigned to audit RUDOLPH Company. You are asked to summarize the transactions for the year ended December 31, 2021 affecting shareholders' equity and other related accounts. The Shareholders' Equity section of RUDOLPH's December 31, 2020 Statement of Financial Position had the following balances: Ordinary share capital, 2 par value, 1,000,000 shares authorized, 180,000 shares issued, 177,580 shares outstanding Share premium - issuance Share premium - treasury shares Retained earnings Cost of 2,420 treasury shares Total shareholders' equity 360,000 3,640,000 45,000 649,378 (145,200) P4,549,178 D You have extracted the following information from the accounting records and audit working papers:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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What is the correct balance of TOTAL SHARE PREMIUM on December 31, 2021?
Transcribed Image Text:5. What is the correct balance of ordinary share capital on December 31,
2021?
You have been assigned to audit RUDOLPH Company. You are asked to summarize the
transactions for the year ended December 31, 2021 affecting shareholders' equity and other
related accounts. The Shareholders' Equity section of RUDOLPH's December 31, 2020 Statement
of Financial Position had the following balances:
Ordinary share capital, P2 par value, 1,000,000 shares authorized,
180,000 shares issued, 177,580 shares outstanding
Share premium - issuance
360,000
Share premium – treasury shares
Retained earnings
Cost of 2,420 treasury shares
Total shareholders' equity
3,640,000
45,000
649,378
(145,200)
4,549,178
You have extracted the following information from the accounting records and audit working
papers:
2021
Jan. 11– RUDOLPH issued 1,300 treasury shares for P40 per share.
Apr. 1- Sold 180, P1,000 9% bonds due April 2031 at 103 with one detachable warrant
attached to each bond. Interest is payable annually on February 1. The fair market value
of the bonds without the share warrants is 95. The detachable warrants have a fair value
of P50 each and will expire on April 1, 2022. Each warrant entitles the holder to purchase
10 ordinary shares at P40 per share.
• Jun. 6 – 2,800 ordinary shares were subscribed for at P44 per share. 40% of the
subscription was collected.
• Aug. 20 - The balance due on 2,400 shares were received and then issued.
Oct. 1- There were 110 share warrants detached from the bonds and exercised.
• RUDOLPH's net income for 2021 is P950,000
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