Question
Date Transaction Jan 02 Clement Co. is authorized to issue shares as follows: 100,000 ordinary shares with P1 par value 50,000 convertible shares with P2
Date | Transaction |
Jan 02 | Clement Co. is authorized to issue shares as follows: 100,000 ordinary shares with P1 par value 50,000 convertible shares with P2 par value. Each preference share is convertible into two ordinary share. |
03 | Incorporators of Clement Co. subscribed 25% of its ordinary shares at par paying 25%, balance will be payable at the end of the month. |
04 | Issued 5,000 ordinary shares and 5,000 preference shares in exchange for an equipment costing P 35,000 with a fair value of 30,000. |
05 | Grace subscribed 1,000 ordinary shares for P5 per share paying P2,000, balance will be paid at the end of the month. |
20 | Issued 10,000 preference shares for P15,000 cash. |
31 | Received full payment from the incorporator. The corresponding shares were issued. |
Feb 5 | The board declared Grace delinquent for non-payment of her subscription despite of the notice given. |
10 | The subscribed shares of Grace were sold in a public auction. Clement incurred P1,000 for this. Bidders are: Charmaine: 1,000 shares Bless: 800 shares Gideon: 750 shares |
11 | Received payment from the highest bidder. Corresponding shares were issued. |
15 | Issued 20,000 ordinary shares for P5 per share. |
20 | Issued 20,000 preference shares for a land costing P50,000. The share is currently selling at P6 per share. |
March 15 | Reacquired all ordinary shares issued on January 4 at P5 per share. |
31 | Reissued 1,000 treasury shares for P6 per share. |
April 1 | 5,000 preference shares sold on January 20 was converted into ordinary shares. |
20 | Reissued 2,000 treasury shares for P4 per share. |
Sept. 30 | Retired the remaining treasury shares. |
Nov. 1 | Declared 2 for 1 share split. |
Dec. 25 | Issued 2,000 ordinary shares for P10 per share and 5,000 preference shares for P15 per share |
31 | Net Income for the Period amounted to 750,000 |
Required:
1. Prepare all the necessary journal entry to record the above transaction. Use memorandum method.
2. Determine the ending balance of the following accounts:
a. Ordinary Shares
b. Preference Shares
c. Share Premium-OS
d. Share Premium-PS
e. Accumulated Profits/ Retained Earnings
f. Total Shareholder's Equity
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