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& Prepare joarnal entries to record the transartions uing the memorandum method. Present thhe shareholdere' equity in the atatement of financial poaition.

& Prepare joarnal entries to record the transartions uing the memorandum method. Present thhe shareholdere' equity in the atatement of financial poaition.

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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Problem 20-4   

P The estity provided the fllowing transaitions sffecting Brok Conpany was erganined at the beginning of curt Problem 20-4 (IAA) aharebolders equity: 1 The entity was authorined to inaue the following sham capital Preference share capital, PI00 par. 30,000 ahares Ordinary share capital, PS0 par value, 100,000 shares 2 40.000 ordinary shares of were issued for cash at Po0 par ahare 3. 10.000 preference shares were lasued at PI20 for caah 4. 10,000 preference ahares were subecribed at par value S P00,000 was received on the above subscription to preference shares. 6. 1,000 preferenoe shares were iaed in payment of legal fees of P100,000 in ennnection with organizing the corporation. 7. 20.000 ordinary ahares were iued for property, plant and equipment which had a fair value of PL300.000 8. 15,000 ordinary sharea were subecribed for at par. 9 Purty peroent of the ordinary ahare capital subecription wan collected. 10. The balance owing on the subscription described in 4 and S was collected, and the preferenoe shares were isued 11. The net income for the current year was P2,000,000. Required: a Peepare journal entries to record the transactions uing the memorandum method. Present the shareholdera' equity in the statement of financial position.
Transcribed Image Text:P The estity provided the fllowing transaitions sffecting Brok Conpany was erganined at the beginning of curt Problem 20-4 (IAA) aharebolders equity: 1 The entity was authorined to inaue the following sham capital Preference share capital, PI00 par. 30,000 ahares Ordinary share capital, PS0 par value, 100,000 shares 2 40.000 ordinary shares of were issued for cash at Po0 par ahare 3. 10.000 preference shares were lasued at PI20 for caah 4. 10,000 preference ahares were subecribed at par value S P00,000 was received on the above subscription to preference shares. 6. 1,000 preferenoe shares were iaed in payment of legal fees of P100,000 in ennnection with organizing the corporation. 7. 20.000 ordinary ahares were iued for property, plant and equipment which had a fair value of PL300.000 8. 15,000 ordinary sharea were subecribed for at par. 9 Purty peroent of the ordinary ahare capital subecription wan collected. 10. The balance owing on the subscription described in 4 and S was collected, and the preferenoe shares were isued 11. The net income for the current year was P2,000,000. Required: a Peepare journal entries to record the transactions uing the memorandum method. Present the shareholdera' equity in the statement of financial position.
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