PROBLEM 1

The LEILA Corporation has two classes of share capital outstanding: 9%, P20 par Preference and P70 par Ordinary. During the fiscal year ending December 31, 2021, the company had the following equity transactions in chronological order: No. of shares Price per share Issue of preference share 10,000 P28 Issue of ordinary share 35,000 70 Reacquisition and retirement of preference 2,000 30 Purchase of treasury ordinary share 5,000 80 Share split 2-for-1 Reissue of treasury ordinary share 5,000 52 Balances of the accounts in the shareholders equity section of the December 31, 2020 statement of financial position were: Preference Share Capital, 50,000 shares P 1,000,000 Ordinary Share Capital, 100,000 shares 7,000,000 Share Premium Preference 400,000 Share Premium Ordinary 1,200,000 Retained Earnings 550,000 Dividends were paid at the end of the fiscal year on the ordinary share at P1.20 per share and on the preference at the preference rate. Profit for the year was P 850,000. How much should be the amount of Preference Share Capital to be shown on the December 31, 2021 statement of financial position? How much should be the amount of Ordinary Share Capital to be shown on the December 31, 2021 statement of financial position? The retirement of the 2,000 preference shares would decrease Share Premium Preference by After the split, the par value per share of the ordinary share capital What is the total cost of the remaining treasury shares?

PROBLEM 2

The Hannah Corporations statement of financial position shows total shareholders equity of P3, 150,000 as of December 31, 2021. What is the book value per share, assuming that the company has only one class of share capital outstanding consisting of 50,000, P10 par ordinary shares? What is the book value per ordinary share assuming that the company has two classes of share capital outstanding consisting the following: 5,000, P100 par value preference shares with a liquidation value of P120 per share and 50,000, P10 par value ordinary shares?

PROBLEM 3

The Katherine Company began operations in January 2021 and reported the following results for each of its three years of operations. 2021- P520, 000 loss; 2022- P80, 000 loss; 2023- P1, 600,000 profit; At December 31, 2023, Katherine Companys capital accounts were as follows: 8% Cumulative Preference Share Capital, P100 par; 50, 000 shares authorized, issued and outstanding P5,000,000 Ordinary Share Capital, P10 par; 1,000,000 shares authorized; 750,000 shares and outstanding P7,500,000 Katherine Company has never paid a cash or bonus issue and there has been no change in its capital accounts since it began operations in 2021. The corporation law permits dividends only from retained earnings. What is the book value of the ordinary share at December 31, 2023? What is the book value of the ordinary share at December 31, 2023 assuming that the preference share has a liquidating value of P106 per share?

Please kindly provide explanation thank you.