ACCTG 26_FINAL EXAM

An entity issued bonds with face value of P3, 000, 000 together with 60, 000, P50 par value, ordinary shares and 20, 000, P100 par value, preference shares for a total consideration of P10, 000, 000. If the bonds were issued separately, they would have sold for P2, 500, 000. At the date of issuance, the ordinary share was selling for P100 per share and the preference share was selling for P150 per share.

What amount of the proceeds should be allocated to the preference shares?

• P 2, 000, 000

• P 2, 500, 000

• P 2, 608, 696

• P3, 000, 000

Yahairah Corp. ‘s outstanding share capital at December 15, 2019, consisted of the following:

· 30, 000 5% cumulative preference shares, par value P10 per share, fully participating as to dividends. No dividends were in arrears.

· 200, 000 ordinary shares, par value P1 per share.

On December 15, 2019, Yahairah declared dividends of P100, 000. What was the amount of dividends payable to Yahairah’s ordinary shareholders?

• P 10, 000

• P 34, 000

• P 40, 000

• P 47, 500

What is the meaning of net assets of a corporation

• Contributed capital

• Retained earnings

• Shareholders' equity

• Legal capital

When shares with par value are sold, the excess of the proceeds over the par value is credited to

• Share capital

• Share premium

• Retained earnings

• Gain on issuance of shares

If shares are issued for a non-cash consideration, the shares issued shall be measured by

• fair value of the shares

• par value of the shares

• fair value of the non-cash consideration

• carrying amount of the non-cash consideration

In computing the basic EPS, if the preference share is cumulative, the amount that should be deducted as an adjustment to the numerator is the

• Preference dividends in arrears

• Preference dividends in arrears net of tax

• Annual preference dividend net of tax

• Annual preference dividend

At year-end, Mary Company canceled 5,000 shares of P 50 par value held in treasury at an average cost of P 120 per share. Before recording the cancelation of the treasury shares, the entity had the following balances:

Share capital issued originally at P 75 per share, P 2,500,000

Share premium, P 1,250,000

Retained earnings, P 1,000,000

Treasury shares, at cost, P 600,000

What amount should be reported as adjusted share capital at year-end

• 2,250,000

• 2,500,000

• 1,900,000

• 2,125,000

At beginning of the current year, Havey Company had 125,000 shares issued which included 25,000 shares held as a treasury.

Jan 1 through Oct 31 - 13,000 treasury shares were distributed to officers as part of a share compensation plan

Nov 1 - A 3 for 1 split too effect

Dec 1 - the entity purchased 5,000 of its own shares to discourage an unfriendly takeover. These shares were not retired

How many shares were outstanding at year end?

• 334,000

• 324,000

• 300,000

• 285,000

The corporate charter is known as

• Articles of incorporation

• Statement of organization

• By-laws

• Registration statement

The share capital is measured by

• the shares outstanding multiplied by par value

• the shares outstanding multiplied by market value

• the shares issued multiplied by par value

• the shares issued multiplied by book value