Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

German Corp. is publicly owned, and its shares are traded in the Philippine Stock Exchange. German Corp. has 30,000 shares of P20 stated value ordinary

image text in transcribedimage text in transcribedimage text in transcribed

image text in transcribedimage text in transcribedimage text in transcribed
German Corp. is publicly owned, and its shares are traded in the Philippine Stock Exchange. German Corp. has 30,000 shares of P20 stated value ordinary share capital. Only 50% of these shares have been issued, of which only 11,000 are outstanding. On December 31, 2019, theshareholders' equity section revealed that the total balance of share premium was P4,160,000 and the retained earnings balance was P1, 100,000. Treasury shares were purchased at an average cost of P37.50 per share. During 2020, German Corp. had the following transactions: Jan. 15 Issued at P55 per share, 800 shares of P50 par, 8% cumulative preference shares 2,000 shares were authorized. Feb 1 Sold 1,500 ordinary shares (newly issued) at P42 per share. Mar 15 Declared cash dividend on ordinary shares at P1.50 per share payable on April 30 to all shareholders of record on April 1. Apr. 15 Reacquired 200 ordinary shares for P43 per share. Apr. 30 Paid the dividends. Apr. 30 Employees exercised 10,000 options granted in 2020 under a share option plan. When the options were granted, each option entitled the employees to purchase one ordinary share for P40 per share. The share price on the grant date was P45 per share. The company issued new shares to the employees. The fair value of the options at the date of grant was P6, while its fair value on this date is P7.50. May 1 declared a 10% bonus issue to be distributed on June 1 to shareholders of record on May 7. The market price of the ordinary share was P55 on May 1. May 31 sold 150 treasury shares reacquired on April 15 and an additional 2,000 shares that had been on hand since the beginning of the year. The selling price was P57 per share. June 1 distributed the bonus issue Sept 15 the semi-annual cash dividend on ordinary shares was declared amounting to P1.50 per share. The company also declared the annual dividend on preference shares. Both are payable on October 15 to shareholders of record on October 1. Oct 15 The company paid the dividends Dec 31 Profit was P500,000Required: a. Prepare the working paper for shareholders' equity as of December 31, 2020, using the following format: Preference Share Ordinary Share Share Retained Treasury Shares Date Shares Amount Shares Amount Premium Earnings Shares Amount

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

9th edition

1118608224, 1118608227, 730323994, 9780730323990, 730319172, 9780730319177, 978-1118608227

More Books

Students also viewed these Accounting questions

Question

Where is the position?

Answered: 1 week ago

Question

Please show calculations in the format below so I understand.

Answered: 1 week ago