The PowerPoint Corporation has two classes of share capital outstanding: 9% (dividend rate), P20 par, Preference and P70 par, Ordinary. During the fiscal year ending December 31, 2012, the company had the equity transactions in chronological order as reflected in the table below. Dividends were paid at the end of the fiscal year on the ordinary share at P1.20 per share and on the preference at the preference rate. Profit for the year was P850,000. How much should be the amount of Preference Share Capital to be shown on the December 31, 2012 statement of financial position? How much should be the amount of Ordinary Share Capital to be shown on the December 31, 2012 statement of financial position? a. P9,450,000 b. P9,310,000 c. P9,130,000 d. P4,725,000
The PowerPoint Corporation has two classes of share capital outstanding: 9% (dividend rate), P20 par, Preference and P70 par, Ordinary. During the fiscal year ending December 31, 2012, the company had the equity transactions in chronological order as reflected in the table below. Dividends were paid at the end of the fiscal year on the ordinary share at P1.20 per share and on the preference at the preference rate. Profit for the year was P850,000. How much should be the amount of Preference Share Capital to be shown on the December 31, 2012 statement of financial position? How much should be the amount of Ordinary Share Capital to be shown on the December 31, 2012 statement of financial position? a. P9,450,000 b. P9,310,000 c. P9,130,000 d. P4,725,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The PowerPoint Corporation has two classes of share capital outstanding: 9% (
How much should be the amount of Ordinary Share Capital to be shown on the December 31, 2012 statement of financial position?
a. P9,450,000
b. P9,310,000
c. P9,130,000
d. P4,725,000
Transcribed Image Text:No. of shares
Price per share
Issue of preference share
10,000
P28
Issue of ordinary share
35,000
70
Reacquisition and retirement of preference
2,000
30
Purchase of treasury ordinary share
5,000
80
Share split
2-for-1
Reissue of treasury ordinary share
5,000
52
Balances of the accounts in the shareholders' equity section of the December 31, 2011 statement of financial
position were:
Preference Share Capital, 50,000 shares
P1,000,000
Ordinary Share Capital, 100,000 shares
7,000,000
Share Premium - Preference
400,000
Share Premium - Ordinary
1,200,000
Retained Earnings
550,000
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