What is the reduction in total par value of shares to fully eliminate the deficit?
What is the reduction in total par value of shares to fully eliminate the deficit?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
An entity was reporting losses for several years. The board of directors and shareholders approved a quasi-reorganization. The reorganization included reducing inventory and land by P300,000 and P800,000 respectively. Immediately before the restatement, the entity had the following balances:
Share capital (320,000 issued shares, P10 par) - 3,200,000
Share premium - 800,000
Retained eamings (deficit) - (400,000)
What is the reduction in total par value of shares to fully eliminate the deficit?
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