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Mr. A subscribe to buy 1,000 shares of the ordinary shares of entity Z for P22 per share, although the par value is only P10 per share. He pays P4 per share immediately and will pay the remaining P18 per share later. Which of the following is correct? 1. Share premium is increased at the time of the subscription by P4,000 2. On the day of the subscription, a ordinary shares subscribed account is increased for the P10 par value of the stock

Mr. A subscribe to buy 1,000 shares of the ordinary shares of entity Z for P22 per share, although the par value is only P10 per share. He pays P4 per share immediately and will pay the remaining P18 per share later. Which of the following is correct? 1. Share premium is increased at the time of the subscription by P4,000 2. On the day of the subscription, a ordinary shares subscribed account is increased for the P10 par value of the stock

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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Mr. A subscribe to buy 1,000 shares of the ordinary shares of entity Z for P22 per share, although the par value is only P10 per share. He pays P4 per share immediately and will pay the remaining P18 per share later. Which of the following is correct? 1. Share premium is increased at the time of the subscription by P4,000 2. On the day of the subscription, a ordinary shares subscribed account is increased for the P10 par value of the stock A) 1 only B) 2 only C) both 1 and 2 D) neither 1 nor 2
Transcribed Image Text:Mr. A subscribe to buy 1,000 shares of the ordinary shares of entity Z for P22 per share, although the par value is only P10 per share. He pays P4 per share immediately and will pay the remaining P18 per share later. Which of the following is correct? 1. Share premium is increased at the time of the subscription by P4,000 2. On the day of the subscription, a ordinary shares subscribed account is increased for the P10 par value of the stock A) 1 only B) 2 only C) both 1 and 2 D) neither 1 nor 2
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