JKL Co. issued 20,000 shares of its P25 par value ordinary shares and 4,000 shares of its P50 par value preference shares for a total of P350,000 cash and an equipment with acquisition cost of P900, 000, book value of P450, 000 and fair value of P500, 000. On that date, the fair value of ordinary shares is P30. How much is allocated to the preference shares? Prepare the journal entry to record the issuance of the shares.
JKL Co. issued 20,000 shares of its P25 par value ordinary shares and 4,000 shares of its P50 par value preference shares for a total of P350,000 cash and an equipment with acquisition cost of P900, 000, book value of P450, 000 and fair value of P500, 000. On that date, the fair value of ordinary shares is P30. How much is allocated to the preference shares? Prepare the journal entry to record the issuance of the shares.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![JKL Co. issued 20,000 shares of its P25 par value ordinary shares and
4,000 shares of its P50 par value preference shares for a total of P350,000
cash and an equipment with acquisition cost of P900, 000, book value of
P450, 000 and fair value of P500, 000. On that date, the fair value of
ordinary shares is P30. How much is allocated to the preference shares?
Prepare the journal entry to record the issuance of the shares.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2a8a3a77-c78b-46da-8b20-7c0eb07efd05%2Faac2070b-df09-42e3-a3ed-1b413735df94%2Ffgrbvooh_processed.png&w=3840&q=75)
Transcribed Image Text:JKL Co. issued 20,000 shares of its P25 par value ordinary shares and
4,000 shares of its P50 par value preference shares for a total of P350,000
cash and an equipment with acquisition cost of P900, 000, book value of
P450, 000 and fair value of P500, 000. On that date, the fair value of
ordinary shares is P30. How much is allocated to the preference shares?
Prepare the journal entry to record the issuance of the shares.
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