Prepare the journal entries using Memorandum Entry method Compute for the following balance: Share Capital Subscribed Share Capital Additional Paid In Capital Subscription Receivable Legal Capita
Prepare the journal entries using Memorandum Entry method Compute for the following balance: Share Capital Subscribed Share Capital Additional Paid In Capital Subscription Receivable Legal Capita
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Happy Food Corporation was authorized to issue 500,000 shares of stock with a par value of P40. The following initial transactions took place during March:
1 Pre-incorporation subscription at the par value by the following incorporators:
Shares Payment
Jolly 20,000 P500,000
Burgee 20,000 P200,000
Wendy 25,000 275,000
King 25,000 300,000
Shake IT 20,000 300,000
Domini 25,000 250,000
5 - Issued 30,000 shares to McDo for Land costing P1,500,000 but with a market value of P1,750,000
10- Sold for cash, 10,000 shares at P55 per share to Tia Maria
15- Jolly and King paid 50% of their subscription balance
25- King paid for his subscription balance and was issued a stock certificate
28- Starbox subscribed to 20,000 shares at 120% of the par value and paid 25%
29- Starbox paid his subscription balance in the form of merchandise and was issued stock certificate
30- King notified the corporation of the sale of 10,000 shares to Heaven for P750,000 Stock Certificate was properly endorsed ans surrendered to the corporate secretary . The certificate was cancelled and two new certificates were issued to: King for 15,000 shares and Henwa for 10,000 shares.
Required:
Prepare the journal entries using Memorandum Entry method
Compute for the following balance:
Share Capital
Subscribed Share Capital
Additional Paid In Capital
Subscription Receivable
Legal Capita
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