On January 1, 2020, ABC Company began operations by issuing P15 per share one-half of the 950,000
Question:
On January 1, 2020, ABC Company began operations by issuing P15 per share one-half of the 950,000 ordinary shares of P10 par value that had been authorized for sale. In addition, the entity has 500,000 authorized preference shares of P5 par value. During the year, the entity had P1,025,000 of net income and declared P230,000 of dividend.
For the year 2021, the entity had the following transactions:
1. Issued 100,000 ordinary shares for P17 per share.
2. Issued 150,000 preference shares for P8 per share
3. Authorized the purchase of a custom-made machine to be delivered in January 2022. The entity restricted P300,000 of retained earnings for this purchase.
4. Issued additional 50,000 preference shares for P9 per share.
5. Reported P1,215,000 of net income and declared on December 31, 2021 a cash dividend of P635,000 to shareholders of record on January 15, 2022 to be paid on February 1, 2022.
What is the shareholder's equity on December 31, 2021?
A. 11,850,000
B. 12.485,000
C. 10,635,000
D. 11,550,000
Expert Answer:
Calculation of shareholders equity on December 31 2021 Number Rate Description Issue at time of star... View the full answer
