T. Galang Corporation was incorporated on Jan. 1, 2019, the articles of incorporation authorized the' Issuance of 50,000 shares of P5 par ordinary shares and 20, 000 shares of P100 par, 8% preference shares. The following events occurred during 2019: a. Issued for cash 10, 000 shares of ordinary shares at P25 per share and 1,000 shares of preference shares at P110 per share on Jan. 15, 2019. b. Amuired a book collection on April 1 in exchange for 2,000 shares of ordinary shares. At the time of the exchange, the Ordinary shares was selling on the local stock exchange for P30 per share. c. Repurchased 500 shares of ordinary shares on May 1 at P20 per share. The, corpora'tion' Is holding the stock to be used fOr an employee bonus plan. d. Declared a cash dividend of P1 per share to ordinary shareholders and an 8% ' dividend to preference shareholders on. July 1. The preference shares is noncumulative, nonparticipating. The dividend will be distributed on Aug. 1. V e. Distributed the cash dividend on Aug. 1. f. Declared, and distributed to preference shareholders a 10% share dividend on Sept. 1. At the time of the dividend declaration, preference Shares was valued at P130 per share. g. On Dec. 31, calculated the 'annual profit for the year to be P200, 000. T. Galang wants to transfer the proﬁt from the Income Summary account to the Retained Earnings account.Required:1. Journalize'the transactions. 2. Prepare the shareholders' equity'section of T. Galang Corporatio'n- 5 statement of financial position as at Dec. 31, 2019. 3. Determine the book value per share of the ordinary-shares. Assume that the preference shares can be redeemed at par.

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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T. Galang Corporation was incorporated on Jan. 1, 2019, the articles of incorporation authorized the' Issuance of 50,000 shares of P5 par ordinary shares and 20, 000 shares of P100 par, 8% preference shares. The following events occurred during 2019: a. Issued for cash 10, 000 shares of ordinary shares at P25 per share and 1,000 shares of preference shares at P110 per share on Jan. 15, 2019. b. Amuired a book collection on April 1 in exchange for 2,000 shares of ordinary shares. At the time of the exchange, the Ordinary shares was selling on the local stock exchange for P30 per share. c. Repurchased 500 shares of ordinary shares on May 1 at P20 per share. The, corpora'tion' Is holding the stock to be used fOr an employee bonus plan. d. Declared a cash dividend of P1 per share to ordinary shareholders and an 8% ' dividend to preference shareholders on. July 1. The preference shares is noncumulative, nonparticipating. The dividend will be distributed on Aug. 1. V e. Distributed the cash dividend on Aug. 1. f. Declared, and distributed to preference shareholders a 10% share dividend on Sept. 1. At the time of the dividend declaration, preference Shares was valued at P130 per share. g. On Dec. 31, calculated the 'annual profit for the year to be P200, 000. T. Galang wants to transfer the proﬁt from the Income Summary account to the Retained Earnings account.Required:1. Journalize'the transactions. 2. Prepare the shareholders' equity'section of T. Galang Corporatio'n- 5 statement of financial position as at Dec. 31, 2019. 3. Determine the book value per share of the ordinary-shares. Assume that the preference shares can be redeemed at par.

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