1. Cory Company issued 120,000 shares of its P10 par ordinary to Fuzzy Inc. in lieu of a real estate property located in Makati. The current fair value of the real property is at P3,900,000 while Cory Company shares are currently selling in the public market. The shares of Cory are highly speculative and that it has been trading in the market at a 52 week low of P12 to a against a 52 week high of P55. It is currently quoted at P46. By what amount the Share Premium account of Cory Company would increase as a result of the issuance of those shares?

2. Ball Company issued 50,000 shares of its P100 par ordinary and 80,000 shares of its P50 convertible preference for a total amount of P12,500,000. At the date of issue, the ordinary shares had a market value of P120 per share and the preference shares are selling at P75 per share. What is the amount credited to share premium from preference shares?

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Answer Of Question 1 Step 1 Share premium Share premium is the additional premium amou... View the full answer