ANSWER THE QUESTION IN MEMORANDUM AND JOURNAL ENTRY

Arsons was organized on February 3, 2019 with authorized share capital consisting of 200,000 shares of P 70 par value 12% preference share capital and 400,000 shares of ordinary share capital with P 40 stated value. The following transactions occurred during February and March:

Feb 12 Issued 50,000 ordinary shares to incorporators for P 45 per share.

Feb 15 Issued 20,000 preference shares for P 72 per share.

Feb 27 Issued 5,000 ordinary shares for land with a book value of P 210,000 and fair market of value of

P 285,000.

Mar 03 Issued 2,000 ordinary shares for the services rendered by Atty. Damian. He assists the

corporation in obtaining the certificate of incorporation and provides legal consultation relative to the incorporation. The value of his service cannot be estimated reliably. The fair market value of the shares is P 43.

Mar 12 Issued 800 ordinary shares for P 36 per share.

Mar 24 Issued 1,500 preference shares in exchange for equipment.

The fair market value of the equipment was not able to assess. While the fair market value of the shares at the time of exchange was not available.

Instruction: Prepare the journal entries using (1) Memorandum Entry Method and (2) Journal Entry Method.