(3) Under the original term, BAÇ Warrants gave Berkshire the right to buy700 million shares of BAC common stock for an additional cash of $5billion. Assume that Berkshire exercises the warrants under the originalterm. What would be the effect on the financial statements of BAC whenBerkshire exercises the warrants under the original term?Total assets: [ Select ]Total liabilities: [ Select ]Total equity: [ Select]Net income: [ Select ]

TOTAL ASSETS will increase as the cash flow from financing activity will increase. therefore it will…

700 million shares of BAC common stock for an additional cash of $. billion. Assume that Berkshire exercises the warrants under the orig term. What would be the effect on the financial statements of BAC Berkshire exercises the warrants under the original term? Total assets: [ Select ] Total liabilities: [ Select ]

700 million shares of BAC common stock for an additional cash of $. billion. Assume that Berkshire exercises the warrants under the orig term. What would be the effect on the financial statements of BAC Berkshire exercises the warrants under the original term? Total assets: [ Select ] Total liabilities: [ Select ]

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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Carlin Enterprises purchased 2,000 shares of the 2,000,000 common shares outstanding in Captain Inc. Carlin intends to hold on to this investment for the foreseeable future. How should this investment be classified on the books of Carlin? O trading equity investment O held-to-maturity debt investment O held-to-maturity equity investment O available-for-sale equity investment Question 23 eld-to-maturity securities affects other comprehensive income and appear as financing activities on the statement of cash flows. es to financial statements.
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Carlin Enterprises purchased 2,000 shares of the 2,000,000 common shares outstanding in Captain Inc. Carlin intends to hold on to this investme for the foreseeable future. How should this investment be classified on the books of Carlin? O trading equity investment O held-to-maturity debt investment O held-to-maturity equity investment O available-for-sale equity investment Question 23 Held-to-maturity securities O affects other comprehensive income and appear as financing activities on the statement of cash flows. are never disclosed in the notes to financial statements
Answers are given. Only need solution for the answers. 22. The following are an excerpt from the consolidated statement of changes in equity of LycheeHoldings Inc. and Subsidiaries for the year ended December 31, 2020:• Capital stock- P2,916,845,000• Treasury shares- P760,088,000• Additional paid-in capital- P856,684,000• Retained earnings- P6,143,508,000• Equity reserves (It pertains to the difference between the consideration transferred and theequity acquired in a common control business combination)- P264,560,000• Remeasurement loss on defined benefit plan- P29,294,000• Net unrealized gain on equity instruments at fair value through OCI- P9,517,000• Non-controlling interests- P2,723,129,000How much is the total shareholders’ equity as of December 31, 2020?answer- P12,124,861,000 24. Melon Co. uses the direct method to prepare its statement of cash flows. Melon had the followingcash flows during 2020:• Cash receipts from issuance of ordinary shares - P800,000• Cash receipts from…
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PROBLEM 2 The bank accepted an equity interest in Seal Company in the form of 200,000ordinary shares quoted at P12 per share. The par value is P10 per share. The fair value of the note payable on the date of restructuring is P2,200,000.Requirement:a. What amount should be recognized as gain from debt extinguishment as a resultof the equity swap? b. What amount should be recognized as share premium from issuance of theshares?