The stockholders' equity account balances of Image Corporation as of December 31, 2020 are as follows: Ordinary shares, P100 par; 50,000 shares authorized; 25,000 shares issued, P2,500,000 Share premium, P1,500,000 Accumulated profits, P1,000,000 Treasury shares, 2,000 shares at cost, P360,000 On January 10, 2021 Image reacquired additional 2,000 shares from stockholders at P225 On February 5, 2021, Image sold 2,500 treasury shares on the open market a P200 per share. On March 15, 2021, Image retired 1,000 treasury shares of the remaining treasury shares, the entry to record the retirement shall include: Debit to accumulated profits of P10,000 Debit to accumulated profits of P60,000 Debit to accumulated profits of P27,500 O Debit to accumulated profits of P37,500

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter10: Stockholder's Equity
Section: Chapter Questions
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The stockholders' equity account balances of Image Corporation as of
December 31, 2020 are as follows:
Ordinary shares, P100 par; 50,000 shares authorized; 25,000 shares issued,
P2,500,000
Share premium, P1,500,000
Accumulated profits, P1,000,000
Treasury shares, 2,000 shares at cost, P360,000
On January 10, 2021 Image reacquired additional 2,000 shares from
stockholders at P225
On February 5, 2021, Image sold 2,500 treasury shares on the open market at
P200 per share.
On March 15, 2021, Image retired 1,000 treasury shares of the remaining
treasury shares, the entry to record the retirement shall include:
O Debit to accumulated profits of P10,000
O Debit to accumulated profits of P60,000
Debit to accumulated profits of P27,500
Debit to accumulated profits of P37,500
Transcribed Image Text:The stockholders' equity account balances of Image Corporation as of December 31, 2020 are as follows: Ordinary shares, P100 par; 50,000 shares authorized; 25,000 shares issued, P2,500,000 Share premium, P1,500,000 Accumulated profits, P1,000,000 Treasury shares, 2,000 shares at cost, P360,000 On January 10, 2021 Image reacquired additional 2,000 shares from stockholders at P225 On February 5, 2021, Image sold 2,500 treasury shares on the open market at P200 per share. On March 15, 2021, Image retired 1,000 treasury shares of the remaining treasury shares, the entry to record the retirement shall include: O Debit to accumulated profits of P10,000 O Debit to accumulated profits of P60,000 Debit to accumulated profits of P27,500 Debit to accumulated profits of P37,500
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