On December 1, 2019, Bobcat Corporation received a donation of 2,000 shares with P 50 par value from a shareholder. On that date, the share market value was P 350. The shares were originally issued for P 250 per share. By what amount would this donation cause shareholders equity to decrease?

a. P700,000

b. P500,000

c. P200,000

d. P0

Magalang, Matulungin, Masipag and Matapat are partners sharing earnings in the ratio of 3:6:9:12. The balance of their capital accounts on June 30, 2021 are as follows: Magalang P2,000; Matulungin P50,000; Masipag P50,000; Matapat P18,000 The partners decided to liquidate, and they accordingly convert the non-cash assets into P46, 400 of cash. After paying the liabilities amounting toP16,000, they have P70,000 to divide. Assume all partners are solvent. How much is the total assets of the partnership?

a. P39,600

b. P86,400

c. P16,000

d. P126,000

When treasury stock is purchased for more than the par value of the stock and the cost method is used to account for treasury stock, what account(s) should be debited?

a. Paid-in capital in excess of par for the purchase price

b. Treasury stock for the par value and paid-in capital in excess of par for the excess of the purchase price over the par value

c. Treasury stock for the par value and retained earnings for the excess of the purchase price over the par value

d. Treasury stock for the purchase price

The government must grant the incorporators a charter giving them permission to form a corporation in or der for an entity to start a business as a corporation

a. True

b. False

When share capital is issued in exchange for non-cash assets, the assets receive should be recorded at the par value of shares issued.

a. True

b. False

Subscriptions receivable from sale of shares which are not collectible currently shall be presented as

a. other asset

b. long-term investment

c. current assets

d. deduction from the related subscribed share capital in the shareholder's equity section

A capital deficiency in a partner's capital, which is not made good is

a. a loss to the other partners

b. gain to the other partners

c. the result of loss in operation

d. the result of a sale of non-cash assets at a gain

Assuming that a partnership has no loans from partners, how is a partner's loss absorption capacity computed?

a. divide his pre-liquidation capital balance by his profit and loss ratio

b. divide his profit and loss ratio by his pre-liquidation capital balance

c. multiply his pre-liquidation capital balance by his profit and loss ratio

d. multiply his pre-liquidation capital balance by his fractional share of profit and loss

In the preparation of schedule of safe payments to partners, cash withheld for possible liquidation expenses and unrecognized liabilities is treated as

a. possible loss

b. liabilities

c. loss on realization

d. operating expenses

In cases when there is no bidder for a delinquent subscription, the corporation will issue to the delinquent subscriber a number of shares equivalent to his previous payment

a. True

b. False

The corporation will always issue all the delinquent shares to the highest bidder

a. True

b. False

The total shareholders' equity after he declaration of hare capital dividend

a. is greater than the total shareholder's equity before the declaration

b. is less than the total shareholders' equity before the declaration

c. is the same as the total shareholders' equity before the declaration

d. may be more than or less than the total shareholders' equity before the declaration depending on whether the share capital dividend declared is small or large

In computing earnings per share, the amount of preference dividends on noncumulative preference shares shall be deducted from net income whether declared or not.

a. True

b. False