PROBLEM 1: The following events and transactions relate to the shareholder's equity accounts of the Reverse Corporation in 2020: Jan 3 The articles of incorporation were received, authorizing Reverse Corporation to issue 100,000 shares of P5 par ordinary shares and 30,000 shares of P50 par preference shares. Jan 5 Received subscriptions to 25,000 ordinary shares and 13,000 preference shares. The subscription price was P15 for ordinary share and P60 for preference share; one third of the total of each class of share was received as a down payment. Jan 9 200 preference shares were issued to the lawyers in payment for legal services rendered in drawing up the articles of incorporation. A value of P56 per share was deemed appropriate. Jan 15 50% of the remaining balance of preference shares subscribed in Jan 5 was collected. Jan 31 Issued 20,000 ordinary shares in exchange for building with book value of 80,000. Collected the balance due on the subscribed ordinary and preference shares. The share certificates were issued. Feb 15 Feb 28 Received subscription of 5,000 ordinary shares at P8. 50% was collected. Mar 1 Issued 2,000 ordinary shares for cash at P6 per share. Accepted subscriptions to 3,800 preference shares at P62 per share. The subscribers each made down payments of 40% of the subscription price. Mar 31 Required: 1. Prepare journal entries using Journal entry method for the quarter ended2020.
PROBLEM 1: The following events and transactions relate to the shareholder's equity accounts of the Reverse Corporation in 2020: Jan 3 The articles of incorporation were received, authorizing Reverse Corporation to issue 100,000 shares of P5 par ordinary shares and 30,000 shares of P50 par preference shares. Jan 5 Received subscriptions to 25,000 ordinary shares and 13,000 preference shares. The subscription price was P15 for ordinary share and P60 for preference share; one third of the total of each class of share was received as a down payment. Jan 9 200 preference shares were issued to the lawyers in payment for legal services rendered in drawing up the articles of incorporation. A value of P56 per share was deemed appropriate. Jan 15 50% of the remaining balance of preference shares subscribed in Jan 5 was collected. Jan 31 Issued 20,000 ordinary shares in exchange for building with book value of 80,000. Collected the balance due on the subscribed ordinary and preference shares. The share certificates were issued. Feb 15 Feb 28 Received subscription of 5,000 ordinary shares at P8. 50% was collected. Mar 1 Issued 2,000 ordinary shares for cash at P6 per share. Accepted subscriptions to 3,800 preference shares at P62 per share. The subscribers each made down payments of 40% of the subscription price. Mar 31 Required: 1. Prepare journal entries using Journal entry method for the quarter ended2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:PROBLEM 1: The following events and transactions relate to the shareholder's equity accounts
of the Reverse Corporation in 2020:
Jan 3
The articles of incorporation were received, authorizing Reverse Corporation to
issue 100,000 shares of P5 par ordinary shares and 30,000 shares of P50 par
preference shares.
Jan 5
Received subscriptions to 25,000 ordinary shares and 13,000 preference shares.
The subscription price was P15 for ordinary share and P60 for preference share;
one third of the total of each class of share was received as a down payment.
Jan 9
200 preference shares were issued to the lawyers in payment for legal services
rendered in drawing up the articles of incorporation. A value of P56 per share was
deemed appropriate.
Jan 15
50% of the remaining balance of preference shares subscribed in Jan 5 was
collected.
Jan 31
Issued 20,000 ordinary shares in exchange for building with book value of 80,000.
Collected the balance due on the subscribed ordinary and preference shares. The
share certificates were issued.
Feb 15
Feb 28
Received subscription of 5,000 ordinary shares at P8. 50% was collected.
Mar 1
Issued 2,000 ordinary shares for cash at P6 per share.
Accepted subscriptions to 3,800 preference shares at P62 per share. The
subscribers each made down payments of 40% of the subscription price.
Mar 31
Required:
1. Prepare journal entries using Journal entry method for the quarter ended2020.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 5 steps with 4 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education