Exercise 6-5 (Journalizing Share Capital Transactions) The BCD Corporation was organized on January 2. 2021 with authorized capital of 500,000 shares of P20 par value ordinary share capital. During the first two years, the following transactions took place: 2021 Jan 2 Issued 125,000 shares to the incorporators at P26. Ma 2 Issued 62,500 shares at P35. 3 Issued 25,000 in exchange for land valued at P350,000 and a building valued at 1 P550,000. 3 The Income Summary account showed a credit balance of P750,000 and this 1 was transferred to the Retained Eamings account. 3 Declared cash dividends of P3.50 per share payable on January 31, 2022 to 1 shareholders of record of January 15, 2022. Ma De 2022 Jan 3 Paid dividends deciared on December 31. Fe b Ma 1 Received subscriptions for 50,000 shares at P55, with a down payment of 35% 4 of total subscriptions. Received balance due on the subscription of February 14 and shares were 5 issued to the subscribers. 3 De The Income Summary account showed a credit balance of P2,000,000 and this was transferred to the Retained Eamings account. 3 Declared a cash dividend of P4.00 per share and a 10% stock dividend payable on January 31, 2023 to shareholders of record of January 15, 2023. On this date, stocks are selling at P30 per share. Instructions: 1. Give the journmal entries to record the preceding transactions. 2. Prepare the shareholders' equity section of the statement of financial positi. Corp. as of December 31, 2021. 3. Prepare a statement of changes in shareholders' equity for the year ended December 31, 2021 2/2
Exercise 6-5 (Journalizing Share Capital Transactions) The BCD Corporation was organized on January 2. 2021 with authorized capital of 500,000 shares of P20 par value ordinary share capital. During the first two years, the following transactions took place: 2021 Jan 2 Issued 125,000 shares to the incorporators at P26. Ma 2 Issued 62,500 shares at P35. 3 Issued 25,000 in exchange for land valued at P350,000 and a building valued at 1 P550,000. 3 The Income Summary account showed a credit balance of P750,000 and this 1 was transferred to the Retained Eamings account. 3 Declared cash dividends of P3.50 per share payable on January 31, 2022 to 1 shareholders of record of January 15, 2022. Ma De 2022 Jan 3 Paid dividends deciared on December 31. Fe b Ma 1 Received subscriptions for 50,000 shares at P55, with a down payment of 35% 4 of total subscriptions. Received balance due on the subscription of February 14 and shares were 5 issued to the subscribers. 3 De The Income Summary account showed a credit balance of P2,000,000 and this was transferred to the Retained Eamings account. 3 Declared a cash dividend of P4.00 per share and a 10% stock dividend payable on January 31, 2023 to shareholders of record of January 15, 2023. On this date, stocks are selling at P30 per share. Instructions: 1. Give the journmal entries to record the preceding transactions. 2. Prepare the shareholders' equity section of the statement of financial positi. Corp. as of December 31, 2021. 3. Prepare a statement of changes in shareholders' equity for the year ended December 31, 2021 2/2
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 6-5 (Journalizing Share Capital Transactions)
The BCD Corporation was organized on January 2, 2021 with authorized capital of 500,000
shares of P20 par value ordinary share capital. During the first two years, the following
transactions took place:
2021
Jan
Issued 125,000 shares to the incorporators at P26.
2 Issued 62,500 shares at P35.
2
Ma
Ma
Issued 25,000 in exchange for land valued at P350,000 and a building valued at
P550,000.
De
3
The Income Summary account showed a credit balance of P750,000 and this
was transferred to the Retained Eamings account.
3
Declared cash dividends of P3.50 per share payable on January 31, 2022 to
shareholders of record of January 15, 2022.
2022
Jan 3
Paid dividends declared on December 31.
Fe
b
Ma
Received subscriptions for 50,000 shares at P55, with a down payment of 35%
4
1
of total subscriptions.
Received balance due on the subscription of February 14 and shares were
issued to the subscribers.
De
3
The Income Summary account showed a credit balance of P2,000,000 and this
1
was transferred to the Retained Eamings account.
Declared a cash dividend of P4.00 per share and a 10% stock dividend payable
1
on January 31, 2023 to shareholders of record of January 15, 2023. On this
date, stocks are selling at P30 per share.
Instructions:
1. Give the jourmal entries to record the preceding transactions.
2. Prepare the shareholders' equity section of the statement of financial positiu.
Corp. as of December 31, 2021.
3. Prepare a statement of changes in shareholders' equity for the year ended December
31, 2021
2/2
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