M Company is a publicly held company whose shares are traded in the over-the-counter market. The shareholder’s equity accounts at December 31, 2022 had the following balances: Preference share capital, Php 100 par, 12% cumulative; 50,000 shares authorized; 20,000 shares issued and outstanding Php 2,000,000 Ordinary share capital, Php 10 par; 150,000 shares authorized; 100,000 shares issued and outstanding 1,000,000 Share premium 8,000,000 Accumulated profits 2,586,000 Total shareholder’s equity 13,586,000 Transactions during 2023 and other information relating to shareholder’s equity accounts were as follows: • February 1: Issued 30,000 ordinary shares to R Company in exchange for a piece of land. On this date, the ordinary share had a market price of Php 20 per share. The land had a carrying value on R Company’s books of Php 420,000 and an assessed value for property taxes of Php 400,000. • March 1: Purchased 5,000 of its own ordinary shares to be held as treasury for Php 24 per share. • May 10: Declared property dividend (equity investments at fair value through profit or loss) to ordinary shareholders. The investments had a carrying amount of Php 600,000 as of December 31, 2022 and fair values were Php 720,000 on May 10, 2021 (declaration date) and Php 736,000 on June 1, 2023 (distribution date). • October 1: Reissued 2,000 treasury shares at Php 26. • Declared a cash dividend of Php 5 per share to ordinary shareholders of record of November 15, 2023 and payable on November 25, 2023. • Declared the required annual cash dividend on preference share for 2023. The dividend was paid on January 5, 2024. • Profit for 2023 was Php 8,380,000. 1.) How many ordinary shares are outstanding at December 31, 2023? a. 150,000 b. 130,000 c. 127,000 d. 100,000 2.) How much is the total amount of cash dividends declared during 2023? a. 890,000 b. 875,000 c. 635,000 d. 240,000 3.) How much is the accumulated profits balance reported at December 31, 2023? a. 9,371,000 b. 9,355,000 c. 9,340,000 d. 2,586,000 4.) How much is the total shareholder’s equity at December 31, 2023? a. 13,586,000 b. 20,955,000 c. 20,903,000 d. 20,887,000
M Company is a publicly held company whose shares are traded in the over-the-counter market. The shareholder’s equity accounts at December 31, 2022 had the following balances:
Ordinary share capital, Php 10 par; 150,000 shares authorized;
100,000 shares issued and outstanding 1,000,000
Share premium 8,000,000
Total shareholder’s equity 13,586,000
Transactions during 2023 and other information relating to shareholder’s equity accounts were as follows:
• February 1: Issued 30,000 ordinary shares to R Company in exchange for a piece of land. On this date, the ordinary share had a market price of Php 20 per share. The land had a carrying value on R Company’s books of Php 420,000 and an assessed value for property taxes of Php 400,000.
• March 1: Purchased 5,000 of its own ordinary shares to be held as treasury for Php 24 per share.
• May 10: Declared property dividend (equity investments at fair value through profit or loss) to ordinary shareholders. The investments had a carrying amount of Php 600,000 as of
December 31, 2022 and fair values were Php 720,000 on May 10, 2021 (declaration date) and Php 736,000 on June 1, 2023 (distribution date).
• October 1: Reissued 2,000 treasury shares at Php 26.
• Declared a cash dividend of Php 5 per share to ordinary shareholders of record of November 15, 2023 and payable on November 25, 2023.
• Declared the required annual cash dividend on preference share for 2023. The dividend was paid on January 5, 2024.
• Profit for 2023 was Php 8,380,000.
1.) How many ordinary shares are outstanding at December 31, 2023?
a. 150,000
b. 130,000
c. 127,000
d. 100,000
2.) How much is the total amount of cash dividends declared during 2023?
a. 890,000
b. 875,000
c. 635,000
d. 240,000
3.) How much is the accumulated profits balance reported at December 31, 2023?
a. 9,371,000
b. 9,355,000
c. 9,340,000
d. 2,586,000
4.) How much is the total shareholder’s equity at December 31, 2023?
a. 13,586,000
b. 20,955,000
c. 20,903,000
d. 20,887,000
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