1.)

On January 1, 2019, Thallium Company reported the following issues of share capital:

200,000 shares at P20, P4,000,000

250,000 shares at P25, P6,250,000

During 2020, the entity reacquired 50,000 shares at P20, and these were reissued at the beginning of 2021 at P25 per share.

Required:

Prepare journal entries to record the foregoing transactions assuming:

a. The share has a P15 par value.

b. The share is no par with stated value of P20.

2.) Lead Company provided the following data for the first year of operations:

a. Sold 30,000 preference shares, 12%, P100 par, at P140.

b. Sold 100,000 ordinary shares of P50, at P55.

c. Purchased and retired 10,000 preference shares at P120.

d. Purchased 15,000 ordinary shares at P52 to be held as treasury.

e. Sold 10,000 treasury shares at P60.

f. Shareholders donated to the entity 20,000 ordinary shares when shares had a market price of P60. One half of these shares were sold for P65.

g. Net income for the year was P3,000,000.

h. Appropriate retained earnings equal to the remaining cost of treasury shares.

Required:

1. Prepare journal entries to record the transactions.

2. Present the shareholders' equity.

3.)Bismuth Company reported the following shareholders' equity:

Ordinary share capital, 20,000 shares, P150 par P3,000,000

Share premium 200,000

Retained earnings 1,500,000

Required:

Prepare journal entry for each of the following cases:

a) Recapitalization is effected, each shareholder receiving 2 shares of new no-par with a stated value of P50 for each share owned.

b) A share split is effected, each shareholder receiving 5 shares, par value P30, for each share owned.

c) A recapitalization is effected, each shareholder receiving 1 share of new P100 par value for each share owned.

d) A recapitalization is effected, each shareholder receiving 4 new shares of P50 par value for each share owned.