Problem On January 1. 2021, Lilianne Company issued mandatorily redeemable preference shares in exchange for cash equal to the total par value of the shares of PS,000,000. No dividenda are to be paid on these shares but the sharee must be redeemed on January 1, 2023 for P6,050,000.. The implicit intereet rate in 10% which is compounded annually. Required: Prepare journal entries for 2021, 2022 and 2023 to record the insuance of preference shares, interest expense and redemption of the shares
Problem On January 1. 2021, Lilianne Company issued mandatorily redeemable preference shares in exchange for cash equal to the total par value of the shares of PS,000,000. No dividenda are to be paid on these shares but the sharee must be redeemed on January 1, 2023 for P6,050,000.. The implicit intereet rate in 10% which is compounded annually. Required: Prepare journal entries for 2021, 2022 and 2023 to record the insuance of preference shares, interest expense and redemption of the shares
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 9
Transcribed Image Text:Problem 20-9 (IAA)
On January 1. 2021, Lilianne Company issued mandatorily
redeemable preference shares in exchange for cash equal to
the total par value of the shares of P6,000,000.
No dividends are to be paid on these shares but the shares
must be redeemed on January 1, 2023 for P6,050,000.
The implicit interest rate is 10% which is compounded
annually.
Required:
Prepare journal entries for 2021, 2022 and 2023 to record
the issuance of preference ahares, interest expense
redemption of the shares.
and
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