On December 31, 2020, COVIVAX Company’s board of directors canceled 20,000 shares of P25 par value ordinary share held in treasury at an average cost of P130 per share. Before recording the cancelation of the treasury share. COVIVAX had the following balances in its shareholders’ equity: ordinary share (250,000 shares originally issued at P55) 6,250,000 Share Premium 7,500,000 Retained earnings 5,000,000 Treasury share, at cost 2,600,000 Your audit shows that in its statement of financial position at December 31, 2020, COVIVAX reported an ordinary share outstanding of P5,750,000. As an auditor, what should be the correct ordinary share outstanding?
On December 31, 2020, COVIVAX Company’s board of directors canceled 20,000 shares of P25 par value ordinary share held in treasury at an average cost of P130 per share. Before recording the cancelation of the treasury share. COVIVAX had the following balances in its shareholders’ equity: ordinary share (250,000 shares originally issued at P55) 6,250,000 Share Premium 7,500,000 Retained earnings 5,000,000 Treasury share, at cost 2,600,000 Your audit shows that in its statement of financial position at December 31, 2020, COVIVAX reported an ordinary share outstanding of P5,750,000. As an auditor, what should be the correct ordinary share outstanding?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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On December 31, 2020, COVIVAX Company’s board of directors canceled 20,000 shares of P25 par value ordinary share held in treasury at an average cost of P130 per share. Before recording the cancelation of the treasury share. COVIVAX had the following balances in its shareholders’ equity:
|
ordinary share (250,000 shares originally issued at P55) |
6,250,000 |
|
Share Premium |
7,500,000 |
|
|
5,000,000 |
|
Treasury share, at cost |
2,600,000 |
Your audit shows that in its
As an auditor, what should be the correct ordinary share outstanding?
Answer in figures, ignore the peso sign.
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