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ABC Corporation has a convertible preference shares with a 2 for 1 ordinary share conversion basis. Other relevant information on January 31, 2021 is as follows: Preference Share, P40 par, 50,000 shares issued and outstanding- P2,000,000 Ordinary Share Capital, P50 par, 80,000 shares issued and outstanding- P4,000,000 Share Premium-Preference- P300,000 Share Premium-Ordinary- P600,000 Retained Earnings- P750,000 Assuming a 30,000 preference shares was converted, how much will be charged to Retained Earnings as a result of conversion? O PO O P630,000 O P112,500 O P120,000

ABC Corporation has a convertible preference shares with a 2 for 1 ordinary share conversion basis. Other relevant information on January 31, 2021 is as follows: Preference Share, P40 par, 50,000 shares issued and outstanding- P2,000,000 Ordinary Share Capital, P50 par, 80,000 shares issued and outstanding- P4,000,000 Share Premium-Preference- P300,000 Share Premium-Ordinary- P600,000 Retained Earnings- P750,000 Assuming a 30,000 preference shares was converted, how much will be charged to Retained Earnings as a result of conversion? O PO O P630,000 O P112,500 O P120,000

FINANCIAL ACCOUNTING
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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ABC Corporation has a convertible preference shares with a 2 for 1 ordinary share conversion basis. Other relevant information on January 31, 2021 is as follows: Preference Share, P40 par, 50,000 shares issued and outstanding- P2,000,000 Ordinary Share Capital, P50 par, 80,000 shares issued and outstanding- P4,000,000 Share Premium-Preference- P300,000 Share Premium-Ordinary- P600,000 Retained Earnings- P750,000 Assuming a 30,000 preference shares was converted, how much will be charged to Retained Earnings as a result of conversion? PO O P630,000 O P112,500 O P120,000
Transcribed Image Text:ABC Corporation has a convertible preference shares with a 2 for 1 ordinary share conversion basis. Other relevant information on January 31, 2021 is as follows: Preference Share, P40 par, 50,000 shares issued and outstanding- P2,000,000 Ordinary Share Capital, P50 par, 80,000 shares issued and outstanding- P4,000,000 Share Premium-Preference- P300,000 Share Premium-Ordinary- P600,000 Retained Earnings- P750,000 Assuming a 30,000 preference shares was converted, how much will be charged to Retained Earnings as a result of conversion? PO O P630,000 O P112,500 O P120,000
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