On January 1, 2019, Swiss Company had 100,000 preference shares at P60 par value. 

On September 30, 2019, the entity issued 100,000 share rights to purchase 4,000. 

The share rights had an expiration date of February 1, 2020. 

The issue price of preference shares with share warrants is P8,000,000. 

On September 30, 2019, each preference share had a market value of 114 and the share rights had a market value of P6. 

Required:

1) How much is the amount allocated to the Preference share?

2) How much is the amount allocated to warrants outstanding?

3) How much is the amount credited to the share premium on the issuance of the preference share?

4) Assuming, all share warrants are exercised, how much is the share premium credited?

Answer rating: 100% (QA)

The amount allocated to the preference ... View the full answer