Problem 1 Pedro Company provided the following data at current year-end: Preference share capital, Php 100 par, 50,000 shares Share premium - preference shares Ordinary share capital, Php 50 par, 100,000 shares Share premium - ordinary share Retained earnings --Php 5,000,000 --500,000 -5,000,000 -1,000,000 -2,000,000 a. Required: (10 points) 1. Prepare the journal entry assuming that 5,000 preference shares are converted: Preference shares are convertible into ordinary shares on a share-for-share basis. b. Each preference share is convertible into 4 ordinary shares. 2. Prepare journal entry assuming 5,000 preference shares are callable and called in for payment at: a. Php 120 b. Php 80