Problem #16 Gloria Detoya Corporation was authorized to issue 900,000 shares of 5%, P100 par value preference shares and 1.5 million shares of no-par, P5 stated value ordinary shares. The following transactions occurred during 2019: 24,000 ordinary shares were sold to a group of investors at P24 per share. Feb. 2 5,500 preference shares were issued to an individual in exchange for a parcel of land to be held for future development. The land has a fair market value of P795,000. The preference shares was not actively traded. Feb. 15 2,500 ordinary shares were issued to a lawyer in exchange for services rendered in forming the corporation. The stock was currently trading at P31 a share. All parties agreed that this represented the value of the lawyer's services. Apr. 30 Nov. 20 Additional 7,000 ordinary shares were issued at P45 per share. 1,400 ordinary shares were repurchased at P35 per share. The shares are to be held in treasury. Nov. 30 Dec. 15 Additional 1,000 preference shares were issued at P125 a share. Dec. 30 The firm sold 600 shares of the stock held in treasury at a price of P41 per share. Dec. 31 Preference dividends were declared and paid in cash. Required: 1. Prepare the journal entries to record these transactions. 2. Assuming that the profit for the year amounted to, P450,000, prepare the shareholders' equity section of the statement of financial position as at Dec. 31, 2019.
Problem #16 Gloria Detoya Corporation was authorized to issue 900,000 shares of 5%, P100 par value preference shares and 1.5 million shares of no-par, P5 stated value ordinary shares. The following transactions occurred during 2019: 24,000 ordinary shares were sold to a group of investors at P24 per share. Feb. 2 5,500 preference shares were issued to an individual in exchange for a parcel of land to be held for future development. The land has a fair market value of P795,000. The preference shares was not actively traded. Feb. 15 2,500 ordinary shares were issued to a lawyer in exchange for services rendered in forming the corporation. The stock was currently trading at P31 a share. All parties agreed that this represented the value of the lawyer's services. Apr. 30 Nov. 20 Additional 7,000 ordinary shares were issued at P45 per share. 1,400 ordinary shares were repurchased at P35 per share. The shares are to be held in treasury. Nov. 30 Dec. 15 Additional 1,000 preference shares were issued at P125 a share. Dec. 30 The firm sold 600 shares of the stock held in treasury at a price of P41 per share. Dec. 31 Preference dividends were declared and paid in cash. Required: 1. Prepare the journal entries to record these transactions. 2. Assuming that the profit for the year amounted to, P450,000, prepare the shareholders' equity section of the statement of financial position as at Dec. 31, 2019.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:SECTION:
PROFESSOR:
Problem #16
preference shares and 1.5 million shares of no-par. P5 stated value ordinary shares. The
following transactions occurred during 2019:
24,000 ordinary shares were sold to a group of investors at P24 per
share.
Feb. 2
5,500 preference shares were issued to an individual in exchange for a
parcel of land to be held for future development. The land has a fair
market value of P795,000. The preference shares was not actively
traded.
Feb. 15
2,500 ordinary shares were issued to a lawyer in exchange for services
rendered in forming the corporation. The stock was currently trading
at P31 a share. All parties agreed that this represented the value of the
lawyer's services.
Apr. 30
Nov. 20
Additional 7,000 ordinary shares were issued at P45 per share.
1,400 ordinary shares were repurchased at P35 per share. The shares
are to be held in treasury.
Nov. 30
Dec. 15
Additional 1,000 preference shares were issued at P125 a share.
Dec. 30
The firm sold 600 shares of the stock held in treasury at a price of P41
per share.
Dec. 31
Preference dividends were declared and paid in cash.
Required:
1. Prepare the journal entries to record these transactions.
2. Assuming that the profit for the year amounted to, P450,000, prepare the
shareholders' equity section of the statement of financial position as at Dec. 31,
2019.
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