On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical's equity on July 31, 2021, comprised of the following: Ordinary Shares, P10 par P4,000,000 Subscribed ordinary shares 1,000,000 Share premium 600,000 Retained earnings 200,000 Treasury shares, 80,000 shares 1.750,000 What is the effect on the stockholders' equity as a result of the issuance of stock rights? O 2,500,000 increase O200,000 increase O no change O 500.000 increase

On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical's equity on July 31, 2021, comprised of the following: Ordinary Shares, P10 par P4,000,000 Subscribed ordinary shares 1,000,000 Share premium 600,000 Retained earnings 200,000 Treasury shares, 80,000 shares 1.750,000 What is the effect on the stockholders' equity as a result of the issuance of stock rights? O 2,500,000 increase O200,000 increase O no change O 500.000 increase

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 13P

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On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stack. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical's equity on July 31, 2021, comprised of the following Ordinary Shares, P10 par- P4,000,000 Subscribed ordinary shares-1,000,000 Share premium-600,000 Retained earnings-200,000 Treasury shares, 80,000 shares -1,750,000 What is the effect on the stockholders' equity as a result of the issuance of stock rights? A. 500,000 increase B. 2,500,000 increase C.no change D.200,000 increase
On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical’s equity on July 31, 2021, comprised of the following: Ordinary Shares, P10 par P4,000,000 Subscribed ordinary shares 1,000,000 Share premium 600,000 Retained earnings 200,000 Treasury shares, 80,000 shares 1,750,000 What is the effect on the…
On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical's equity on July 31, 2021, comprised of the following: Ordinary Shares, P10 par P4,000,000 Subscribed ordinary shares 1,000,000 Share premium 600,000 Retained earnings 200,000 Treasury shares, 80,000 shares 1,750,000 What is the effect on the stockholders' equity if all but 60,000 share rights were exercised? 1,300,000 increase 1,800,000 increase 2,100,000 increase no change What is the effect on the stockholders' equity as a results of the issuance of stock rights? 200,000 increase no change…
On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical’s equity on July 31, 2021, comprised of the following:             Ordinary Shares, P10 par                                                         P4,000,000             Subscribed ordinary shares                                                      1,000,000                  Share premium 600,000             Retained earnings                                                                         200,000             Treasury shares, 80,000 shares                                                 1,750,000 What is the effect on the…
On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical’s equity on July 31, 2021, comprised of the following:             Ordinary Shares, P10 par                                                         P4,000,000             Subscribed ordinary shares                                                      1,000,000                  Share premium 600,000             Retained earnings                                                                         200,000             Treasury shares, 80,000 shares                                                 1,750,000 What is the effect on the…
On August 1, 2021, Comical Company issued rights to stockholders to subscribe to additional share of its common stock. A stockholder can buy one new share for every 5 rights plus P25 cash. The rights will expire on October 1, 2021. On July 31, 2021, the market price of a share with the right attached was P50, while the market price of the right alone was P5. Comical’s equity on July 31, 2021, comprised of the following:             Ordinary Shares, P10 par P4,000,000             Subscribed ordinary shares 1,000,000                  Share premium 600,000             Retained earnings 200,000             Treasury shares, 80,000 shares 1,750,000 What is the effect on the stockholders’ equity as a result of the issuance of stock rights? no change 2,500,000 increase 500,000 increase 200,000 increase What is the…
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On June 30, 2019, Haiti Company has 200,000 shares of P10 par ordinary share outstanding and the market price of the share is P12 per share. On the same date, the company declared a 1 for 2 share split. Immediately before the split, the total share premium was P900,000. What should be the balance in Haiti’s Share Premium account after the share split is effected?
On March 1, 2019, Mall Co. issued 60,000, P50 par value, ordinary shares and 20,000, P100 par value, preference shares for a total consideration of P7,500,000. At this date, the ordinary share was selling for P100 per share and the preference share was selling for P150 per share. What amount of the proceeds should be allocated to the preference shares?
Delta NV has share capital of $l m in shares of $0.25 each. At 31 May 2019 shares had a market value of $1.1 each. On 1 June 2009 the company makes a rights issue of 1 share for every 4 held at $0.6 per share. Its profits were $500,000 in 2019 and $440,000 in 2018. The year-end is 30 November. Required: Calculate (a) the theoretical ex-rights price; (b) the bonus issue factor; (c) the basic earnings per share for 2018; (d) the basic earnings per share for 2019.
Amaya Company offered existing shareholders a rights issue of one for 5 shares at a price ofP6 per share to be exercised on April 1, 2020. The market value of share was P12 on thatdate.On January 1, 2019, there are 810,000 ordinary shares outstanding.The entity reported net income P2,250,000 for 2019 and P3,500,000 for 2020.Required: Compute the basic earnings per share for 2019 and 2020.
On 2, 2019, I AM DETERMINED CO. purchased 10,000 shares of CPA CO. at P56 plus broker’s commission of P4 per share. The investment is FVTOCI. During 2018 and 2020, the following events occurred regarding the investment: 12/15/19 CPA CO. declares and pays a P2.20 per share dividend 12/31/19 The market price of CPA CO. stock is P52 per share at year-end 12/01/20 CPA CO. declares and pays a dividend of P2 per share 12/31/20 The market price of CPA CO. stock is P55 per share at year-end The net unrealized loss at December 31, 2020 in accumulated OCI in shareholders' equity is