Question
ABC Co holds 20,000 shares of XYZ Inc as investment in equity security measured at Cost. The investment has carrying amount of P500,000. On October
ABC Co holds 20,000 shares of XYZ Inc as investment in equity security measured at Cost. The investment has carrying amount of P500,000. On October 1, 20x1, ABC Co receives 20,000 stock rights to subscribe for new shares @ P10 per share for every 5 rights held. The fair value per stock right if P5.
On November 2, 20x1 15,000 stock rights were sold @ 4 per right.
On December 1, 20x1 remaining stock rights have expired.
Requirement:
Prepare Journal Entries on October 1, November 2 and December 1, 20x1.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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
Management and Cost Accounting
Authors: Colin Drury
8th edition
978-1408041802, 1408041804, 978-1408048566, 1408048566, 978-1408093887
