1. In 2018, Pacers Corporation issued for P 100 per share, 15,000 convertible preference shares of P 100 par value. One preference share may be converted into three ordinary shares of P 25 par value at the option of the preference shareholder. On December 31, 2018, all of the preference shares were converted into ordinary shares. The market value of the ordinary share at the conversion date was P 40. What amount should be credited to ordinary share capital on December 31, 2018?

2. The shareholders equity of Atlanta Hawks Inc., as of December 31, 2018 consists of 10% Preference Shares (cumulative and participating) with outstanding shares of 6,000, P 100 par value; Ordinary Shares of 10,000 with P 40 par value and Retained Earnings of P 800,000. Dividends were in arrears for 2 years at the start of 2018. Dividends declared for 2018 amounted to P 200,000.

How much will be in arrears at the end of 2018?

3. Clippers Corporation had sufficient retained earnings in 2018 as a basis for dividends but was temporarily short of cash. The entity declared a dividend of P 1,000,000 on April 1, 2018, and issued promissory notes to the shareholders in lieu of cash. The notes, which were dated April 1, 2018, had a maturity date of March 31, 2019 and a 10% interest rate. How should the scrip dividend and related interest be recorded?