1. What is the credit to the share premium from preference shares accounts as a result of the issuance of ordinary and preference shares on January 5? a. 250,000 c. 650,000 b. 300,000 d. 700,000 2. The entry to record cash dividends on June 30 requires a debit to retained earnings at: a. 560,000 c. 575,000 b. 540,000 d. 585,000 3. The entry to record the reissue treasury shares on July 30 requires a debit to a. Share premium P40,000 b. Retained earnings P40,000 c. Share premium P80,000 d. Retained earnings P80,000 4. The entry to record the stock dividends on August 30 requires a debit to retained earnings at: a. 500,000 c. 850,000 b. 540,000 d. 918,000 5. What is the balance of the share premium in excess over par from ordinary shares as of December 31, 2020? a. 3,040,000 c. 3,152,500 b. 3,080,000 d. 2,842,500 6. What is the balance of the Preference shares account as of December 31, 2020? a. 1,000,000 c. 1,250,000 b. 1,200,000 d. 1,450,000 7. What is the balance of the Retained earnings - unappropriated as of December 31, 2020? a. 7,436,000 c. 7,103,000 b. 7,436,000 d. 7,145,000

The shareholders' equity section of Stuart Company's statement of financial position as of December 31, 2019, is as follows: Ordinary shares, $10, par value; authorized, 2,000,000 shares; issued 400,000 shares $4,000,000 Preference shares, $5 par value; authorized, 1,000,000 shares; issued 200,000 1,000,000 Share premium - Ordinary shares 1,800,000 Share premium - Preference shares 600,000 Retained earnings 6,000,000 Total $13,400,000 The following transactions occurred during 2020: Jan. 5 The company issued for $2,350,000, 100,000 ordinary shares and 50,000 preference shares. The company incurred share issue cost at $150,000. The ordinary shares were currently selling at $15 per share while the preference shares at $10. Feb. 16 50,000 preference shares were subscribed at $12 per share. Mar. 25 20,000 previously ordinary shares were issued in exchange of an equipment having a fair market value of $500,000. The company incurred share issue costs at $20,000. Apr. 20 Reacquired 40,000 ordinary shares as treasury shares at $18 per share. Jun. 30 The company declared $0.50 cash dividends to ordinary shares and $1 per share cash dividends to preference shares. Jul. 30 Reissued half of the treasury shares at $16 per share. Aug. 30 A 10% ordinary stock dividend was declared and issued to ordinary shares. Market value is currently at $17 per share. Sep. 16 Collected full payments on 80% of the preference shares subscribed on February 16. Dec. 31 The company declared and paid $0.50 cash dividends to ordinary shares and $1 per share cash dividends to preference shares. Dec. 31 Adjusted net income for the year is at $3,510,000