Question
A. Treasury share is appropriately presented on the statement of financial position as a a.trading security or available for sale security. b.deduction at cost from
A. Treasury share is appropriately presented on the statement of financial position as a
a.trading security or available for sale security.
b.deduction at cost from total shareholders' equity.
c.deduction at cost from total contingent liabilities.
d.deduction at par from total shareholders' equity.
B. Preference share split that has a claim on any prior year dividends that may have passed is
a.cumulativec.non-cumulative
b.participatingd.non-participating
C. A company issued rights to its existing shareholders to purchase for P30 per share, unissued shares of P15 par value ordinary share capital. Additional paid-in capital will be credited when the
Rights are issuedRights are exercisesRights lapse
a.YesNoNo
b.NoNoYes
c.NoYesNo
d.YesYesYes
D.Under IFRS 2, Share Based Payment, the value of the options that lapse after vesting shall
a.be credited to expense during the period the option lapse.
b.be credited to income during the period that the options lapse.
c.remain in equity.
d.be converted into a liability.
E. In 2012, Inna Corporation acquired 6,000 shares of its P10 par value ordinary share capital at P36 per share. During 2012, Inna issued 3,000 of these shares at P50 per share. Inna uses the cost method to account for its treasury share transactions. What accounts and amounts should Inna credit in 2012 to record the issuance of the 3,000 shares?
Treasury ShareAPICRetained EarningsOrdinary Shares
a.-P102,000P42,000P6,000
b.-144,000-6,000
c.P108,00042,000--
d.108,000-42,000-
F. A holder of a redeemable preference share can
a.purchase treasury shares any time at the shareholders' option.
b.purchase additional shares offered in order to maintain the same fractional
interest in the corporation.
c.turn in the preference shares for a specified cash price at aspecified date or during a specified period.
d.convert the preference shares for ordinary shares.
G. When should the compensation expense be recorded as a result of share options granted by the enterprise to its employees?
a.during the year of grant.
b.during the year that the options ultimately vest.
c.during the years when services are requiredto be rendered by the employees.
d.during the year when the option first becomes exercisable.
H. Ownership of shares of share capital entitles the holders to all of the following rights except:
a.to elect the board of directors of the corporation.
b.to share in the profits of the corporation.
c.to purchase new shares of stock when they are offered for sale.
d.to participate in the daily operations of the corporation.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started