shares capital, P100 par, 30,000 shares 3,000,000 Share premium 500,000 Retained earnings 2,500,000 Total shareholder’s equity P8,000,000 No dividends are in arrears up to December 31, 2012. The company declared P1,000,000 dividend at the end of 2014 at the appropriate rate for preference shares and the remainder to ordinary.
shares capital, P100 par, 30,000 shares 3,000,000 Share premium 500,000 Retained earnings 2,500,000 Total shareholder’s equity P8,000,000 No dividends are in arrears up to December 31, 2012. The company declared P1,000,000 dividend at the end of 2014 at the appropriate rate for preference shares and the remainder to ordinary.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The shareholder’s equity in the
Ordinary shares capital, P100 par, 30,000 shares 3,000,000
Share premium 500,000
Total shareholder’s equity P8,000,000
No dividends are in arrears up to December 31, 2012. The company declared P1,000,000 dividend at the end of 2014 at the appropriate rate for preference shares and the remainder to ordinary.
REQUIRED:
Determine the allocation of the dividend to (1) preference and (2) ordinary, assuming the following cases independently:
- Preference share is noncumulative and nonparticipating.
- Preference share is cumulative and nonparticipating.
- Preference share is cumulative and participating.
- Preference share is cumulative and participating up to 12%.
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