1) As of December 15, 2020, ABC Corporation reported Ordinary Shares, 100,000 shares issued and outstanding, P15,000,000; Share Premium, P2,000,000; Retained Earnings, P9,150,000. The next day, the entity received donation P1,000,000 cash and 4,000 of its own shares from a shareholder when the market price is P261.50 per share. What is the new book value per share?

a. P282.81

b. P271.50

c. P293.71

d. P281.96

2) On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following IS TRUE when the entity declares 10% share dividend when the market price is P145 per share?*

a. Retained earnings will decrease by P300,000 only.

b. Share Premium account will remain at P120,000.

c. Ordinary share account increase by P300,000.

d. The book value per share will increase.

3) ABC Corporation was organized on January 1, 2019 with issuance of P100 par value 300,000 ordinary shares at total consideration P33,590,000. During 2019 and 2020, the entity reported net income of P5,527,000 and P2,523,000, respectively. At December 31, 2019 and 2020, the retained earnings showed balances of P4,527,000 and P5,300,000. What is the change in the dividend per share?*

a. 2.50

b. 5.83

c. 8.41

d. 18.42

4) As of December 31, 2020, ABC Corporation reported 200,000 P10-par value ordinary shares authorized, 100,000 shares issued. Total shareholders equity has a balance of P9,150,000. During 2020, the entity made a profit P3,500,000, declared P1,000,000 cash dividend and 100% share dividend. What is the book value per share in 2019?*

a. P 71.50

b. P 76.50

c. P143.00

d. P153.00

5) On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, no-par value, 50,000 shares authorized; 30,000 shares issued and outstanding, P1,290,000;; and Retained Earnings P1,200,000. When the board of directors changes the no-par value ordinary shares to P40-par value, how will this affect the book value per share?

a. Decrease the book value per share.

b. Increase the book value per share.

c. Book value per share will remain the same.

d.

6) The book value per share cannot be determined due to limited information.

On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following is not correct after the declaration of a 2-for-1 share split?

a. The authorized 50,000 shares at P100 par value will now be 100,000 shares at P50 par value.

b. There will be 40,000 unissued ordinary shares

c. The ordinary share, share premium and retained earnings balances will not change.

d. Total outstanding shares will be 60,000 shares at P100 par value.

7) ABC Corporation was organized on January 1, 2019 with issuance of P100 par value 300,000 ordinary shares at total consideration P33,590,000. During 2019 and 2020, the entity reported net income of P5,527,000 and P2,523,000, respectively. At December 31, 2019 and 2020, the retained earnings showed balances of P4,527,000 and P5,300,000. What is the change in the earnings per share?

a. 18.42

b. 15.09

c. 10.01

d. 5.83

8) The shareholders' equity showed a balance of P5,915,000 after deducting 1,000 treasury ordinary shares for P25,000. There are 249,000 ordinary shares outstanding. After selling the 1,000 treasury ordinary shares for P30,000, how will this affect the total number of shares issued and outstanding?

a. No change in number of shares issued and outstanding.

b. Increase in number of shares issued and outstanding.

c. No change in number of shares issued but increase in number of shares outstanding.

d. Increase in number of shares issued but no change in number of shares outstanding.

9) On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following has least decrease effect on the retained earnings?

a. A 2-for-1 share split, 20% share dividend, P1 cash dividend per share.

b. 20% share dividend, a 2-for-1 share split, P1 cash dividend per share.

c. P1 cash dividend per share, 20% share dividend, a 2-for-1 share split.

d. 20% share dividend, P1 cash dividend per share, a 2-for-1 share split.

10) ABC Corporation was organized on January 1, 2019 with issuance of P100 par value 300,000 ordinary shares at total consideration P33,590,000. During 2019 and 2020, the entity reported net income of P5,527,000 and P2,523,000, respectively. At December 31, 2019 and 2020, the retained earnings showed balances of P4,527,000 and P5,300,000. What is the change in the book value per ordinary share?*

a. 129.63

b. 127.06

c. 2.57

d. 17.67

11) ABC Corporation has 1,000,000 P10 par value ordinary shares authorized. Shares are issued at par value. The entity annually declares P1 cash dividend per share when there were 100,000 shares outstanding in 2017; 200,000 shares outstanding in 2018 and 300,000 shares outstanding in 2019. What is the amount of profit in 2019 if the entity has maintained every year P12 book value per share?

a. P900,000

b. P600,000

c. P500,000

d. P400,000

12) On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following IS NOT TRUE when the entity declares 20% share dividend when the market price is P150 per share?*

a. The book value per share will remain the same.

b. The total shareholders' equity will remain the same.

c. 6,000 ordinary shares will be added as issued and outstanding shares.

d. Retained earnings will decrease from P1,200,000 to P600,000.

13) On December 31, 2019 ABC Corporation has 100,000 P100 par value ordinary shares outstanding, Share Premium P2,000,000 and Retained Earnings P10,000,000. If in 2020, the entity reported P5,000,000 profit, declared a 2-for-1 share split and followed by 100% share dividend,, what is the amount of legal capital in 2020?

a. P5,000,000

b. P10,000,000

c. P20,000,000

d. P40,000,000

14) ABC Corporation was organized on January 1, 2019 with issuance of P100 par value 300,000 ordinary shares at total consideration P33,590,000. During 2019 and 2020, the entity reported net income of P5,527,000 and P2,523,000, respectively. At December 31, 2019 and 2020, the retained earnings showed balances of P4,527,000 and P5,300,000. Which of the following is not likely to happen?

a. A 4-for-1 share split

b. Changing from P100 par value to no-par P75 stated value

c. Reduction of P100 par value to P80 par value

d. A 15% share dividend when the market price is P130 per share.

15) ABC Corporation was organized on January 1, 2019 with issuance of P100 par value 300,000 ordinary shares at total consideration P33,590,000. During 2019 and 2020, the entity reported net income of P5,527,000 and P2,523,000, respectively. At December 31, 2019 and 2020, the retained earnings showed balances of P4,527,000 and P5,300,000. Which of the following will change the total shareholders' equity?

a. A 4-for-1 share split

b. P1 cash dividend per share.

c. Reduction of P100 par value to P80 par value

d. A 15% share dividend when the market price is P130 per share.