CORPORATION V2

Which is an advantage of a shareholder over a partner

• Owner cannot directly control business operation

• Owner can easily transfer his interest

• Owner's liability is limited

• 2

Which of the following is a major disadvantage of a corporation?

• transferability of interest

• availability of capital

• limited liability

• legal requirements

This account title is credited to represent shareholder's equity for contributions

made in cash, property or service.

• share capital

• subscribed share capital

• subscription receivable

• treasury share

The amount at which the issue price exceeds the par value is credited to

• gain on share capital

• share premium

• discount on share capital

Shares of stock a corporation is allowed to issue.

• Subscribed Shares

• Treasury Shares

• Authorized Shares

• Issued SharesIssued Shares

One of these items may not form part of the shareholders' equity section

• retained earnings

• share premium

• authorized shares capital

• subscription receivable

Filipinas Inc. sold 100 shares of P100 par common stock for P120. In recording this transaction you should

• credit ordinary share capital, P12,000

• credit ordinary share premium, P12,000

• credit ordinary share capital P2,000 and ordinary share premium, P10,000.

• credit ordinary share capital P10,000 and ordinary share premium P2,000.

When 100 common shares of P100 par are subscribed for P120

• subscription receivable should be debited for P12,000

• subscription receivable should be debited for P10,000 

• subscribed receivable should be credited for P12,000

• subscribed share capital should be debited for P12,000

When 100 common shares of P100 par are subscribed for P120

Refer to no. 8, the accountant should also credit

• subscribed share capital for P12,000.

• subscribed share capital for P10,000 and share premium for P2,000.

• subscribed share capital for P10,000 and retained earnings for P2,000.

• share capital for P10,000 and share premium for P2,000.

When a par value common stock is exchanged for an asset such as building, the common stock should be credited at the

• par value

• appraisal value of the asset

• book value of the asset

• original cost of the asset