Title | APC ch9sol - Accounting for Partnership Corporation by Baysa and Lupisan 2018 Chapter 9 |
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Course | Bachelor of Science in Accountancy |
Institution | Polytechnic University of the Philippines |
Pages | 16 |
File Size | 244.9 KB |
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Operations, Dividends, Book Value and Earnings per ShareContributed Capital:Ordinary Share Capital Subscribed – 10,000 shares 200,Preference Share Premium 150,Ordinary Share Premium 200,Total Contributed Capital P1,950,Retained Earnings 250,Total Shareholders’ Equity P2,200,Contributed Capital:Prefe...
CHAPTER 9 Operations, Dividends, Book Value and Earnings per Share E 9-1 Contributed Capital: 10% Preference Share Capital, P100 par, cumulative, 10,000 shares authorized, 4,000 shares issued and outstanding Ordinary Share Capital, P20 par, 100,000 shares authorized, 50,000 shares issued and outstanding Ordinary Share Capital Subscribed – 10,000 shares Preference Share Premium Ordinary Share Premium Total Contributed Capital Retained Earnings Total Shareholders’ Equity
P 400,000 1,000,000 200,000 150,000 200,000 P1,950,000 250,000 P2,200,000
E 9-2 Contributed Capital: 10% Preference Share Capital, P40 par, 40,000 shares authorized, 20,000 shares issued and outstanding Preference Share Capital Subscribed P40,000 Less PSC Subscription Receivable 14,000 Ordinary Share Capital, P10 stated value, 500,000 shares authorized, 200,000 shares issued and outstanding Paid-in Capital in Excess of Par – Preference Shares Paid-in Capital in Excess of Stated Value – Ordinary Shares Total Contributed Capital Retained Earnings Total Shareholders’ Equity E 9-3 Mar. 1
Apr.
15
Sept.
1
30
E 9-4 Apr. 1
Retained Earnings Dividends Payable 40,000 sh x P10 = P400,000
400,000
Dividends Payable Cash
400,000
Retained Earnings Dividends Payable 40,000 sh x P20
800,000
Dividends Payable Cash
800,000
Retained Earnings Dividends Payable 100,000 sh x P2
200,000
P800,000 26,000 2,000,000 120,000 100,000 P3,046,000 400,000 P3,446,000
400,000
400,000
800,000
800,000
200,000
APC – Chapter 9 (2014 edition)
May 2
June
1
July 15
Dividends Payable Cash
200,000
Retained Earnings Share Capital Dividends Distributable PIC from Share Capital Dividends 100,000 sh x 10% x P60
600,000
Share Capital Dividends Distributable Ordinary Share Capital
500,000
E 9-5 1. Retained Earnings Share Capital Dividends Distributable PIC from Share Capital Dividends 500,000 sh x 15% x P25 = P1,875,000 500,000 sh x 15% x P10 = P 750,000 Share Capital Dividends Distributable Ordinary Share Capital 2.
July
Oct.
Dec.
200,000
500,000 100,000
500,000
1,875,000 750,000 1,125,000
750,000 750,000
Retained Earnings Share Capital Dividends Distributable 500,000 sh x 50% x P10 = P2,500,000
2,500,000
Share Capital Dividends Distributable Ordinary Share Capital
2,500,000
E 9-6 Mar. 15
Apr.
page 2
15
15
15
1
2,500,000
2,500,000
Retained Earnings Dividends Payable 2,000 sh x P5 = P10,000
10,000
Dividends Payable Cash
10,000
Retained Earnings Property Dividends Payable 2,000 sh x P20
40,000
Property Dividends Payable Investment in Pentagon Corp. Stocks
40,000
Retained Earnings Share Capital Dividends Distributable 2,000 sh x 30% x P25
15,000
Share Capital Dividends Distributable
15,000
Ordinary Share Capital
10,000
10,000
40,000
40,000
15,000
15,000
APC – Chapter 9 (2014 edition)
page 3
E 9-7 Annual PSC dividend requirement – 100,000 sh x P100 x 12% = P1,200,000 1. Preference Ordinary Total Dividends per share: Preference Ordinary 2. 2012 Dividends in arrears – 2 yrs. Current dividends Total Dividends per share 2013 Dividends in arrears Current dividends Balance – Ordinary Total Dividends per share 2014 Current dividends Balance – Ordinary Total Dividends per share
2012 P1,200,000 1,300,000 P2,500,000
2013 P1,200,000 2,300,000 P3,500,000
2014 P1,200,000 5,300,000 P6,500,000
P12.00 P 2.60
P12.00 P 4.60
P12.00 P10.60
Preference
Ordinary
Total
P2,400,000 100,000 P2,500,000
P ----------P -----------
P2,400,000 100,000 P2,500,000
P25.00
P –0--
P1,100,000 1,200,000 P2,300,000
P1,200,000 P1,200,000
P23.00
P 2.40
P1,200,000 P1,200,000
P5,300,000 P5,300,000
P1,100,000 1,200,000 1,200,000 P3,500,000
P1,200,000 5,300,000 P6,500,000
P12.00
P 10.60
Preference
Ordinary
Total
P1,200,000
P600,000
P1,800,000
233,333 P833,333
466,667 233,333 P2,500,000
3. 2012 Regular dividends Balance –P700,000 Preference – 10/15 Ordinary – 5/15 Total Dividends per share
466,667 P1,666,667 P16.67
P1.67
APC – Chapter 9 (2014 edition)
2013 Regular dividends Balance –P1,700,000 Preference – 10/15 Ordinary – 5/15 Total Dividends per share 2014 Regular dividends Balance –P4,700,000 Preference – 10/15 Ordinary – 5/15 Total Dividends per share
page 4
P1,200,000
P 600,000
P1,800,000
P2,333,333
566,667 P1,166,667
1,133,333 566,667 P3,500,000
P23.33
P2.33
P1,200,000
P 600,000
P1,800,000
1,566,667 P2,166,667
3,133,333 1,566,667 P6,500,000
1,133,333
3,133,333 P4,333,333 P43.33
P4.33
Preference
Ordinary
Total
P2,400,000 100,000 P2,500,000
P ----------P -----------
P2,400,000 100,000 P2,500,000
P25.00
P –0--
4. 2012 Dividends in arrears – 2 yrs. Current dividends Total Dividends per share 2013 Dividends in arrears Regular dividends Balance – P600,000 Preference – 10/15 Ordinary – 5/15 Total Dividends per share 2014 Regular dividends Balance – P4,700,000 Preference – 10/15 Ordinary – 5/15 Total Dividends per share
P1,100,000 1,200,000
P 600,000
P1,100,000 1,800,000
200,000 P 800,000
400,000 200,000 P3,500,000
400,000 P2,700,000 P27.00 P1,200,000
P1.60 P 600,000
P1,800,000
1,566,667 P2,166,667
3,133,333 1,566,667 P6,500,000
3,133,333 P4,333,333 P43.33
P4.33
APC – Chapter 9 (2014 edition)
page 5
5. Preference
Ordinary
Total
P1,200,000
P600,000
P1,800,000 466,667 233,333 P2,500,000
2012 Regular dividends Balance –P700,000 Preference – 10/15 Ordinary – 5/15 Total
P1,666,667
233,333 P833,333
Dividends per share
P16.67
P1.67
Regular dividends Balance –P1,700,000 Preference Ordinary Total
P1,200,000
P2,000,000
Dividends per share
P20.00
Regular dividends Balance –P4,700,000 Preference Ordinary Total
P1,200,000
P2,000,000
Dividends per share
P20.00
466,667
2013 P 600,000
P1,800,000
900,000 P1,500,000
800,000 900,000 P3,500,000
800,000
P3.00
2014
E 9-9 a. b. c. d. e.
P10,000/60,000 = P.17 P70,000/60,000 = P1.17 P90,000/60,000 = P1.50 P150,000/60,000 = P2.50 P180,000/60,000 = P3.00
3,900,000 P4,500,000
800,000 3,900,000 P6,500,000
P9.00
P25.00
Total Shareholders’ Equity Equity identified with preference shares (10,000 sh x P120) Equity identified with ordinary shares BV/share: PS – P120.00;
P1,800,000
800,000
E 9-8 1. P5,000,000 / 200,000 shares 2.
P 600,000
OS – P3,800,000/100,000 = P38.00
P5,000,000 1,200,000 P3,800,000
APC – Chapter 9 (2014 edition)
page 6
E 9-10 Profit Less earnings identified with preference share capital (20,000 sh x P100 x 10%) Earnings identified with ordinary shares
P750,000 200,000 P550,000
Earnings per share P550,000/300,000 = P1.67 P 9-1 1. 2014 Jan. 2
Mar. 2
Mar.
Dec.
31
31
31
2015 Jan. 31
Feb.
14
14
Mar. 15
15
Cash Ordinary Share Capital Ordinary Share Premium 125,000 sh x P25
3,125,000
Cash (62,500 sh x P30) Ordinary Share Capital Ordinary Share Premium
1,875,000
Land Building Ordinary Share Capital Ordinary Share Premium
300,000 500,000
Income Summary Retained Earnings
750,000
Retained Earnings Dividends Payable 125,000 + 62,500 + 25,000 = 212,500 sh x P2.50
531,250
Dividends Payable Cash
531,250
2,500,000 625,000
1,250,000 625,000
500,000 300,000
750,000
531,250
531,250
OSC Subscription Receivable (50,000 x P50) OSC Subscribed (50,000 x P20) Ordinary Share Premium
2,500,000
Cash OSC Subscription Receivable P2,500,000 x 40%
1,000,000
Cash OSC Subscription Receivable P2,500,000 x 60%
1,500,000
OSC Subscribed Ordinary Share Capital
1,000,000
1,000,000 1,500,000
1.000,000
1,500,000
1,000,000
APC – Chapter 9 (2014 edition)
Dec.
31
31
31
page 7
Income Summary Retained Earnings
2,000,000 2,000,000
Retained Earnings Dividends Payable 212,500 + 50,000 = 262,500 x P2
525,000
Retained Earnings Stock Dividends Distributable PIC from Stock Dividend 262,500 x 10% x P25 = 262,500
656,250
525,000
525,000 131,250
2. Contributed Capital: Ordinary share Capital, P20 par, 500,000 shares authorized, 212,500 shares issued and outstanding Ordinary Share Premium Total Contributed Capital Retained Earnings Total Shareholders’ Equity 3.
P4,250,000 1,550,000 P5,800,000 218,750 P6,018,750
BCD Corporation Statement of Changes in Shareholders’ Equity For the Year Ended December 31, 2014
Balances, January 1, 2014 Issuance of 125,000 shares@P25 Issuance of 62,500 shares@P30 Issuance of 25,000 shares in exchange for land and building Profit for 2014 Declaration of cash dividends of P2.50 Balances, December 31, 2014
Ordinary Share Capital P 2,500,000 1,250,000
Ordinary Share Premium P 625,000 625,000
500,000
300,000
P4,250,000
PIC from Stock Dividend
Retained Earnings P -
750,000 ( 531,250) p 218,750
P1,550,000
Total P P3,125,000 1,875,000 800,000 750,000 ( 531,250) P6,018,750
P 9-2 MMM Corporation Statement of Changes in Shareholders’ Equity For the Two Years Ending December 31, 2014 Ordinary Ordinary Share Share Capital Premium
Retained Earnings
Total
2013: Issued 120,000 shares @ P24 Loss for the year Balances, December 31
P2,400,000
P 480,000
P2,400,000
P 480,000
Issued 80,000 shares @ P30 Profit for the year Balances, December 31
1,600,000
800,000
(P300,000) (P300,000)
P2,880,000 ( 300,000) P2,580,000
800,000 P500,000
2,400,000 800,000 P5,780,000
2014:
P4,000,000
P1,280,000
APC – Chapter 9 (2014 edition)
page 8
VVV Inc. Statement of Changes in Shareholders’ Equity For the Two Years Ending December 31, 2014 5% Preference Share 2013: Issued 6,000 PS @ P120 Issued 200,000 ordinary shares Profit for the year Dividends: PS – P600,000 x 5% OS – 200,000 shares x P.25 Balances, December 31 2014: Issued 5,000 PS @ P130 Issued 100,000 OS @ P10 Profit for the year Dividends: PS – 1,100,000 x 5% OS - 300,000 shares x P.50 Balances, December 31
Ordinary Share
P 600,000
Preference Share Premium
Retained Earnings
Total
P 240,000
P 720,000 1,400,000 240,000
( 30,000) ( 50,000) P 160,000
( 30,000) ( 50,000) P2,280,000
P 120,000 P1,400,000
P 600,000
P1,400,000
500,000
P 120,000 150,000
650,000 1,000,000 600,000
1,000,000 600,000
P1,100,000
P2,400,000
P 270,000
( 55,000) ( 150,000) P 555,000
( 55,000) ( 150,000) P4,325,000
MMM Corp. Shareholders’ Equity December 31, 2014 Contributed Capital: Ordinary Share Capital, P20 par, 200,000 shares authorized, all issued and outstanding Ordinary Share Premium Retained Earnings Total Shareholders’ Equity
P4,000,000 1,280,000
P5,280,000 500,000 P5,780,000
VVV Inc. Shareholders’ Equity December 31, 2014 Contributed Capital: 5% Preference Share Capital, P100 par, 200,000 shares authorized, 11,000 shares issued and outstanding P1,100,000 Ordinary Share Capital, no par, no Stated Value 500,000 shares authorized, 300,000 shares issued and outstanding 2,400,000 Preference Share Premium 270,000 Retained Earnings Total Shareholders’ Equity
P3,770,000 555,000 P4,325,000
APC – Chapter 9 (2014 edition)
page 9
P 9-3 DEF Corporation Balance Sheet December 31, 2014 Assets Current Assets: Cash Accounts Receivable Less Allowance for Doubtful Accounts Merchandise Inventory Store Supplies Office Supplies Prepaid Insurance Total Current Assets Noncurrent Assets: Land Office Equipment, net of Accumulated Depreciation of P45,000 Store Equipment, net of Accumulated Depreciation of P75,000 Total assets
P 200,000 P 100,000 10,000
P1,000,000 105,000 175,000
90,000 210,000 5,000 4,000 12,000 P 521,000
1,280,000 P1,801,000
Liabilities Current Liabilities: Accounts Payable Income Tax Payable Salaries Payable Total Liabilities Shareholders’ Equity Contributed Capital: Ordinary Share Capital, P20 par, 50,000 shares issued and outstanding Ordinary Share Capital Total Contributed Capital Retained Earnings Total Shareholders’ Equity Total Liabilities and Shareholders’ Equity
P
75,000 139,800 12,000 P 226,800
P1,000,000 100,000 P1,100,000 474,200
DEF Corporation Statement of Changes in Shareholders’ Equity For the Year Ended December 31, 2010 Ordinary Ordinary Retained Share Capital Share Premium Earnings Balances, Jan. 1 P 980,000 P 95,000 P228,000 Issuance of CS 20,000 5,000 Declaration and dist. of dividends ( 80,000) Profit for 2014 326,200 Balances, Dec. 31 P1,000,000 P100,000 P474,200
1,574,200 P1,801,000
Total P1,303,000 25,000 ( 80,000) 326,200 P1,574,200
APC – Chapter 9 (2014 edition)
DEF Corporation Income Statement For the Year Ended December 31, 2014 Sales (net of discounts of P50,000) Cost of Goods Sold: Merchandise Inventory, Jan. 1 Purchases (net of ret. and allow. of P100,000) Cost of Goods available for Sale Less Merchandise Inventory, Dec. 31 Gross Profit Selling Expenses: Sales Salaries Advertising Delivery Store Supplies Depreciation – Store Equipment Miscellaneous Administrative Expenses: Office Salaries Light and Power Insurance Depreciation – Office Equipment Office Supplies Miscellaneous Profit before Income Tax Income Tax (30%) Profit
page 10
P2,450,000 P 150,000 1,300,000 P1,450,000 210,000
P258,000 75,000 50,000 10,000 25,000 20,000 P189,000 60,000 18,000 15,000 6,000 18,000
Earnings per share P326,200/ 50,000 shares 3.
1,240,000 P1,210,000
(438,000)
(306,000) P 466,000 139,800 P 326,200 P6.524
Adjusting Entries Merchandise Inventory Income Summary
210,000
Income Summary Merchandise Inventory
150,000
210,000
150,000
Store Supplies Expense Office Supplies Expense Store Supplies Office Supplies
10,000 6,000
Store Salaries Office Salaries Salaries Payable
8,000 4,000
10,000 6,000
12,000
APC – Chapter 9 (2014 edition)
page 11
Depreciation Expense – Store Equipment Depreciation Expense – Office Equipment Accumulated Depreciation – Store Equipment Accumulated Depreciation – Office Equipment
25,000 15,000
Insurance Expense Prepaid Insurance
18,000
Income Tax Income Tax Payable
139,800
25,000 15,000
18,000
139,800
Closing Entries Sales Purchases Returns and Allowances Sales Discount Purchases Sales Salaries Advertising Delivery Store Supplies Expense Depreciation Expense – Store Equipment Miscellaneous Expenses Office Salaries Light and Power Insurance Depreciation Expense – Office Equipment Office Supplies Expense Miscellaneous Administrative Expenses Income Taxes Income Summary
2,500,000 100,000 50,000 1,400,000 258,000 75,000 50,000 10,000 25,000 20,000 189,000 60,000 18,000 15,000 6,000 18,000 139,800 266,200
Income Summary Retained Earnings
326,200 326,200
P9-4 2012 Regular dividend Balance – P150,000 PS – 2/3; OS –1/3 Total Dividends per share 2013 Regular dividend Balance – P450,000 PS – 2/3; OS –1/3 Total Dividends per share
PS
OS
TOTAL
P200,000
P100,000
P300,000
100,000 P300,000 P15.00
50,000 P150,000 P3.00
150,000 P450,000
P200,000
P100,000
P300,000
300,000 P500,000 P25.00
150,000 P250,000 P5.00
450,000 P750,000
APC – Chapter 9 (2014 edition)
page 12
PS 2014 Regular dividend Balance – P1,400,000 PS – 2/3; OS –1/3 Total Dividends per share
OS
TOTAL
P 200,000
P100,000
P 300,000
933,333 P1,133,333 P56.67
466,667 P566,667 P11.33
1,400,000 P1,700,000
2. PS 2012 Dividends in arrears Current dividends Total Dividends per share 2013 Dividends in arrears Current dividends Balance – to Ordinary Total Dividends per share 2014 Current dividends Balance – to ordinary Total Dividends per share 3. 2012 Dividends in arrears Regular dividends Balance – P90,000 PS – 10/15; OS 5/15 Total Dividends per share 2013 Regular dividends Balance – P630,000 PS – 10/15; OS 5/15 Total Dividends per share 2014 Regular dividends Balance – P1,580,000 PS – 10/15; OS 5/15 Total Dividends per share
OS
TOTAL
P400,000 50,000 P450,000 P22.50
----P –0-P—0--
P400,000 50,000 P450,000
P150,000 200,000
----
P150,000 200,000 400,000 P750,000