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Sand Company provided the following data at current year-end:

Sand Company provided the following data at current year-end:

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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8. Prepare or provide what is require of the problem below

Sand Company provided the following data at current year-end: Preference share capital, P100 par, 50,000 shares Share premium – PS Ordinary share capital, P50 par, 100,000 shares Share premium – ordinary share Retained earnings 5,000,000 500,000 5,000,000 1,000,000 2,000,000 Required: 1. Prepare journal entry assuming that 5,000 preference shares are converted: Preference shares are convertible into ordinary shares on a share-for-share basis. а. b. Each preference share is convertible into 4 ordinary shares. 2. Prepare journal entry assuming 5,000 preference shares are callable and called in for payment at: а. 120 b. 80
Transcribed Image Text:Sand Company provided the following data at current year-end: Preference share capital, P100 par, 50,000 shares Share premium – PS Ordinary share capital, P50 par, 100,000 shares Share premium – ordinary share Retained earnings 5,000,000 500,000 5,000,000 1,000,000 2,000,000 Required: 1. Prepare journal entry assuming that 5,000 preference shares are converted: Preference shares are convertible into ordinary shares on a share-for-share basis. а. b. Each preference share is convertible into 4 ordinary shares. 2. Prepare journal entry assuming 5,000 preference shares are callable and called in for payment at: а. 120 b. 80
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