ABC Company has sustained heavy losses over a period time and conditions warrant that ABC undergo a quasi re-organization at December 31, 2019. Selected balance sheet items prior write down and quasi-reorganization are as follows: • Property, plant and equipment were recorded in the accounting records at December 31, 2019, at P12,000,000, net of accumulated depreciation. The recoverable value is P8,000,000. • Stockholders' equity on December 31, 2019 was as follows: Ordinary share, par value P10 per share authorized, issued and outstanding 700,000 shares- P7,000,000; Share premium- P1,600,000; Retained earnings (deficit)- (P600,000) • Under the terms of the quasi re-organization, the par value of the ordinary share is to be reduced from P10 per share to P5 per share Immediately after the quasi-reorganization has been accomplished, the total stockholders' equity should be:
ABC Company has sustained heavy losses over a period time and conditions warrant that ABC undergo a quasi re-organization at December 31, 2019. Selected balance sheet items prior write down and quasi-reorganization are as follows: • Property, plant and equipment were recorded in the accounting records at December 31, 2019, at P12,000,000, net of accumulated depreciation. The recoverable value is P8,000,000. • Stockholders' equity on December 31, 2019 was as follows: Ordinary share, par value P10 per share authorized, issued and outstanding 700,000 shares- P7,000,000; Share premium- P1,600,000; Retained earnings (deficit)- (P600,000) • Under the terms of the quasi re-organization, the par value of the ordinary share is to be reduced from P10 per share to P5 per share Immediately after the quasi-reorganization has been accomplished, the total stockholders' equity should be:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC Company has sustained heavy losses over a period time and conditions warrant that ABC
undergo a quasi re-organization at December 31, 2019. Selected balance sheet items prior
write down and quasi-reorganization are as follows:
• Property, plant and equipment were recorded in the accounting records at December 31,
2019, at P12,000,000, net of accumulated depreciation. The recoverable value is P8,000,000.
• Stockholders' equity on December 31, 2019 was as follows: Ordinary share, par value P10 per
share authorized, issued and outstanding 700,000 shares- P7,000,000; Share premium-
P1,600,000; Retained earnings (deficit)- (P600,000)
• Under the terms of the quasi re-organization, the par value of the ordinary share is to be
reduced from P10 per share to P5 per share
Immediately after the quasi-reorganization has been accomplished, the total
stockholders' equity should be:
To input answers, kindly follow the sample format below(no peso sign, with comma, no space):
ex. 100,000
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